The Issue Whether Respondent committed the violations alleged in the Administrative Complaint? If so, what punitive action should be taken against Respondent?
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following findings of fact are made: Respondent is now, and has been since 1981, a Florida- licensed general contractor (holding license number CG C019787). At all times material to the instant case, Respondent has been licensed as an individual in his own name, not as a qualifying agent 3/ or under a fictitious name. At no time has Respondent been licensed in the State of Florida as a roofing contractor or as any other type of contractor other than a general contractor. Larry Thomas is now, and has been at all times material to the instant case, the sole owner and president of Home Improvement Time, Inc. (HIT), a corporation that he formed in or around December of 1995. Mr. Thomas, in naming his company, hoped that the public, when hearing the company's name, would associate it with the popular "Home Improvement" television program. There are not now, nor have there ever been, any other owners, officers, or directors of the company. Until late in 1998, HIT was actively engaged in the business of soliciting home improvement work, including room additions and the installation of roofs, hurricane shutters, and screens. To solicit such work, HIT used telemarketers who contacted homeowners over the telephone from HIT's office (located in a shopping center in Jensen Beach, Florida and having the mailing address of 867 Northeast Jensen Beach Boulevard, Jensen Beach, Florida), and it also employed salespersons who visited homeowners at their homes. Among the salespersons who worked for HIT were Vince Ketchum and Bob Andrews. At no time material to the instant case did HIT have a licensed contractor serve as its certified qualifying agent. 4/ Mr. Thomas has never been licensed as a general contractor. Some time after 1996, he obtained aluminum structure and concrete contracting licenses from the City of Port St. Lucie and from Martin County. In or around January of 1996, shortly after the formation of HIT, Respondent met with Mr. Thomas at HIT's office and observed HIT's operations. As a result of this meeting, Respondent hired HIT, on a commission basis, to solicit home improvement work for him. Respondent was the only general contractor for whom HIT solicited business. When a HIT telemarketer made contact with a prospect, the telemarketer indicated that he or she was with HIT. If asked who would be doing the home improvement work, the telemarketer advised the prospect that the work would be done by Respondent. If a prospect contacted by a HIT telemarketer was interested in having home improvement work done, a HIT salesperson was dispatched to the prospect's home. Respondent provided HIT salespersons with training and instructions as to what to do when calling on prospects. On their visits to prospects' homes, the salespersons brought with them preprinted form contracts for the prospects to sign. These form contracts were jointly developed by Mr. Thomas and Respondent (using, as a model, a form contract that was published in a "Better Homes and Gardens" magazine article). On the top right hand corner of these form contracts were the words "licensed" and "insured." To the left of these words, in large, stylized lettering, were either the words "Home Improvement," "Home Improvement Inc.," "Home Improvement Time, Inc.," or "Home Improvement by Richard Kosalka" (depending on the time frame). These words were included on the form because Respondent wanted homeowners to make the connection between him and HIT and the television program after which HIT was named. Underneath these words appeared the following: 667 N.E. Jensen Beach Boulevard Jensen Beach, FL 34957 Richard Kosalka State License # CGCO19787 Among the provisions in the form contracts was the clause, "This agreement subject to office approval." When they returned from their sales calls, the salespersons brought any signed contract to Mr. Thomas at HIT's office. Depending on the nature of the work involved, Mr. Thomas approved or disapproved the contract himself or he gave the contract to Respondent 5/ to approve or disapprove (pursuant to the "subject to office approval" clause in the contract). Any contract that Respondent approved became Respondent's contract to perform. Although he did perform some contract work himself, most often he used subcontractors who worked under his general supervision. HIT received a commission for every approved contract its salespersons procured for Respondent. Its commission (the amount of which was established by agreement between Mr. Thomas and Respondent) was included in the contract price offered to the homeowner. Typically, payment from the homeowner was not due until the contract work was completed. Payment was made by the homeowner to HIT, which then paid Respondent by check in an amount equal to the contract price minus HIT's previously established commission. In an effort to make the public aware of the services it offered, HIT, in or around August of 1996, placed an advertisement in the Bell South Yellow Pages for Port St. Lucie and Stuart. In the advertisement, which was placed without Respondent's knowledge or authorization, HIT's name and telephone number appeared, along with a listing of home improvement services. Among the services listed was "roofing." Appearing at the bottom of the advertisement was the following: "Licensed & Insured KOSALKA CGC 019787." Among the homeowners who had signed the above-described preprinted form contracts that HIT's salesperson's brought back, for "office approval," to the HIT office in 1996 were the following three Port St. Lucie residents: Larkin Dunbar (whose residence was located at 114 Dorchester); Clara Masters (whose residence was located at 246 Northeast Mainsail); and Rita Maciuba (whose residence was located at 733 Southwest Curry Street). The Dunbar, Masters and Maciuba contracts were dated February 19, 1996, May 28, 1996, and June 14, 1996, respectively. On the top of the Dunbar contract, in large stylized lettering, were the words "Home Improvement Inc." On the top of both the Masters and Maciuba contracts, in the same large stylized lettering, were the words "Home Improvement by Richard Kosalka." The Dunbar contract provided for the "furnish[ing of] the following materials, improvements, labor, and/or services" for the price of $3,600.00: the installation of a "new fascia and soffit system," the "repair [of the] master bedroom walls," the "repair [of] roof leaks," and the "paint[ing of the] gutter and garage door to match [the] fascia and soffit." No work was performed pursuant to this contract (nor is there any evidence that the homeowner made any payments for the performance of such work). The Masters contract was signed by Ms. Masters and Vince Ketchum, the HIT salesperson who had negotiated with her at her home. At the time she signed the contract, Ms. Masters was approximately 85 years of age. The contract provided for the "furnish[ing of] the following materials, improvements, labor, and/or services": installation of a "new roof" with "shingles to be selected by Clara Masters" for $3,255.00; the repair and painting of the "interior ceiling" for $627.00; and the "pressure clean[ing] and paint[ing] of [the] exterior of [the] home" and the driveway for $2,628.00. After his mother had signed the contract (and before any contract work had started), Ms. Masters' son, Joseph Masters, who lived next door to his elderly mother and looked after her business affairs, telephoned Respondent, who was an acquaintance of his. Mr. Masters asked Respondent to come by his mother's home to discuss the contract his mother had signed. Respondent went to Ms. Masters' home as Mr. Masters had requested. Upon Respondent's arrival, Mr. Masters informed Respondent that he (Mr. Masters) and his mother wanted the roof work to be done first. Respondent and Mr. Masters then discussed the matter further. Their discussions lead to the contract being modified to provide that only the roof work would be done (for a price of $3,255.00). The modification was made by lining out the other work listed in the contract, having Ms. Masters put her initials next to the line-outs, and adding contract language to reflect that the total contract price was $3,225.00 for the "roof only." Before leaving Ms. Masters' home, Respondent told Mr. Masters that he would have "some roofers [come] around to get the estimate on the roof." Mr. Masters assumed that these roofers would be subcontractors. Respondent brought the modified contract back to the HIT office. The Sunday after his visit to Ms. Masters' home, Respondent's wife suffered a stroke and was hospitalized. Respondent remained in the hospital with his wife and stayed there for three days. David Harris is a licensed general, residential, and roofing contractor and the owner of David Harris Construction (DHC). He has had his roofing license (for work in Martin and St. Lucie Counties) since 1992. In 1996, and for several years prior thereto, Respondent used Mr. Harris as a subcontractor for concrete and roofing work (mostly on new residential construction). At the time he reviewed the modified Masters contract, Mr. Thomas was familiar with Mr. Harris and DHC. Mr. Harris used HIT to follow up on leads generated by DHC's Yellow Pages' advertising. Moreover, Respondent had spoken favorably to Mr. Thomas about Mr. Harris as a roofer. Accordingly, Mr. Thomas telephoned Mr. Harris and told him about the Masters re-roofing project. On the Monday after Respondent's wife was admitted to the hospital, DHC workers went to Ms. Masters' home and began to remove the old roof. A young child (around nine or ten years of age) was on the roof with the workers. Some time later that day, while the workers were still removing the old roof, Mr. Masters came by his mother's house and noticed the workers and the child on the roof. Mr. Masters was dissatisfied with the manner in which the workers were acting and with the quality of their work. He therefore "chased" them off the roof and told them to leave the property. Mr. Harris was not at the site at the time the workers (and the child) were directed to leave, but he later telephoned Mr. Masters "want[ing] to know what was wrong." Mr. Masters told Mr. Harris why he had removed the workers from the property. He further advised Mr. Harris to "not come back anymore," explaining that he would hire another roofer to complete the job (which he subsequently did). Mr. Masters assured Mr. Harris that payment would be made for the work that had been done by DHC on the roof that day, but there was no agreement reached as to the amount of the payment. A few days later, Mr. Harris telephoned Mr. Masters again, inquiring "if he [Mr. Harris] was going to get paid." In response to this inquiry, Mr. Masters replied that he was "going to get with [Respondent] to figure out the amount of work that was done" and he (Mr. Masters) would pay Mr. Harris accordingly. Subsequently (some time on or after June 4, 1996), Mr. Masters received in his mailbox a copy of an "invoice" (in an unstamped, unsealed envelope) from DHC which read as follows: DAVID HARRIS CONSTRUCTION TO: Home Improvement Date: 6/4/96 RE: 246 NE Mainsail, PSL (Masters) DESCRIPTION: Labor & Materials 1 DAY PRICE: $863.39 Thereafter, Mr. Masters telephoned Respondent and told Respondent about the bill he had received (the amount of which Mr. Masters thought was excessive). In response to Mr. Masters' telephone call, Respondent, on June 18, 1996, visited with Mr. Masters and his mother at the latter's home. There, Mr. Masters showed Respondent the copy of the "invoice" he (Mr. Masters) had received. Based upon his knowledge of the prices that Mr. Harris typically charged, Respondent determined that a fair price for the work that the DHC workers had done on Ms. Masters' roof was only $480.00. Respondent so advised Mr. Masters and then telephoned Mr. Harris (from Ms. Masters' home) in an effort to persuade Mr. Harris to accept that amount. Respondent and Mr. Harris, however, were unable to reach agreement on the matter. After hanging up, Respondent told the Masters that he and Mr. Harris "would work something out and get it straightened out." Thereafter, at Respondent's suggestion, Ms. Masters made out and signed a check to "Home Improvement" in the amount of $480.00, which she gave to Respondent, who told the Masters that he would "take care of" the matter. In addition to giving the Masters this assurance, Respondent also provided Ms. Masters, in exchange for the $480.00 check, a receipt marked "paid in full" and a release of lien signed by him. In the release of lien, Respondent identified himself as "Richard Kosalka of Home Improvement, a Florida corporation doing business in the State of Florida." Respondent delivered Ms. Masters' $480.00 check to Mr. Thomas and asked Mr. Thomas to issue an HIT check in that same amount payable to DHC. Mr. Thomas did as he was requested by Respondent. The $480.00 check signed by Mr. Thomas was received and deposited by DHC. Nonetheless, thereafter, on August 19, 1996, DHC filed a claim of lien for $383.39 (the difference between $480.00 and the amount of DHC's original invoice) on Ms. Masters' home. The $383.39 (which DHC claimed it was owed) was never paid; however, DHC took no action with respect to the lien and the lien expired. The Maciuba contract was signed by Ms. Maciuba and Bob Andrews, the HIT salesperson who had negotiated with her at her home. It provided for the "furnish[ing of] the following materials, improvements, labor, and/or services" for the price of $3,600.00: "Tear off existing shingles- Replace rotten facia and roof sheets. Shingle color: Shasta white (lightest color). 4 lengths of ridge vents." HIT contacted DHC to do the work described in the contract. DHC obtained a re-roofing permit for the work on June 21, 1996. DHC hired Jerry Poston to work as subcontractor on the project. Mr. Poston and his crew worked on the project during the period from June 21 through July 29, 1996. Mr. Harris also made an appearance at the work site. Ms. Maciuba made an initial down payment of $300.00, which she gave to Mr. Thomas. Subsequently, after the work had been completed, she gave Mr. Thomas three checks that were payable to herself and which she endorsed. Two of these checks were for $1,000.00, and the remaining check was for $800.00, for a total payment, including the down payment she had made, of $3,100.00, which was less than the $3,600.00 contract price. Ms. Maciuba refused to pay any more because of the damage she claimed her property had sustained as a result of re-roofing work. On August 23, 1996, Mr. Harris filed a claim of lien on Ms. Maciuba's home, in which he alleged that, "in accordance with a contract with Home Improvement Time, Inc.," he had "furnished labor, services or materials" in the amount of $2,565.00, and had not received any payment therefor. On October 15, 1996, Mr. Harris executed a Sworn Statement of Account acknowledging that he was owed only $1,873.18 inasmuch as the "contractor" had made direct payments to Mr. Harris' suppliers, thereby reducing the amount he (Mr. Harris) was owed. Ms. Maciuba, in small claims court, sought to have the lien removed. On November 19, 1996, a mediation session was held at which Ms. Maciuba, Mr. Harris, Mr. Thomas, and Respondent were present. At the session, Mr. Harris agreed to remove the lien in exchange for $1,450.00, of which amount $800.00 was to be paid by Ms. Maciuba and the remaining $650.00 was to be paid by HIT. That very same day, November 19, 1996, Ms. Maciuba and HIT made these agreed-upon payments, and Mr. Harris executed and recorded a release of lien. Ms. Masters and Ms. Maciuba filed complaints that were investigated by Edward Garcia, an investigator with the Department. As part of his investigation, Mr. Garcia spoke with Respondent by telephone on November 7, 1996. Respondent told Mr. Garcia that HIT was a telemarketing business owned by Mr. Thomas; he (Respondent) hired HIT to solicit business for him; he (Respondent) advertised as "Home Improvement" in order to "play off the name of Home Improvement Time"; the contract with Ms. Maciuba was for a re-roofing project and he (Respondent) subcontracted the work to DHC; and he (Respondent) was not aware, that he was not authorized, as a licensed general contractor, to enter into contracts for re-roofing projects. Mr. Garcia also visited HIT's office and met with Mr. Thomas. During this meeting, Mr. Thomas signed a document agreeing not to violate the provisions of Chapter 489, Part I, Florida Statutes, by engaging contracting activities without an appropriate license.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department issue a final order (1) finding Respondent guilty of the violations alleged in Counts I, II, V, VIII, and IX of the Administrative Complaint; (2) disciplining Respondent for having committed these violations by requiring him to pay a fine in the amount of $1,000.00 and to reimburse the Department for all reasonable costs associated with the Department's investigation and prosecution of these charges; and (3) dismissing the remaining counts of the Administrative Complaint. DONE AND ENTERED this 29th day of September, 1999, 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 29th day of September, 1999.
Findings Of Fact At all times relevant hereto, Respondent, Victor L. Contessa, (Contessa) was licensed as a real estate broker in the State of Florida, having been issued license Number 0016808. The last license issued to Respondent was as a broker, c/o Cavalier Southern Realty, Inc., 4343 Ridgewood Avenue, Port Orange Florida, 32019. At all times material hereto, Contessa was owner and president of Cavalier Development and Building Corporation. In 1983, Charles Hill purchased a lot in Port Orange, Florida, more particularly described as Lot 29, Phase One, Cypress Grove. In June of 1983, Charles Hill wished to have a house constructed on his lot. Mr. Hill spoke with Contessa regarding the construction of the house. After reviewing plans with Contessa, Hill entered into a written Building Agreement with Contessa whereby Contessa agreed to construct a house for Hill for $50,000.00, plus extras. At the time he signed the Building Agreement, Hill believed that Contessa was a licensed building contractor. He based this belief upon representations made by Contessa to Hill that Contessa was a licensed building contractor. The Building Agreement, dated June 4, 1983, listed Cavalier Development and Building Corporation as the contractor and was signed by Contessa as president of Cavalier Development and Building Corporation. Contessa was not a licensed building contractor when he signed the Building Agreement. In order to have the house constructed as set forth in the Building Agreement, it was necessary for Contessa to hire a licensed building contractor. Contessa contacted Donald E. Welch, a licensed residential contractor. Contessa represented to Welch that Contessa's company, Cavalier Development and Building Corporation, was the owner of Hill's lot. Based on that representation, Contessa entered into a Building Agreement with Welch to have Welch construct the house for $42,500.00. Welch did not become aware that the lot in question was owned by Hill and not by Contessa or Cavalier Development and Building Corporation until October 25, 1983, when Welch attempted to pull a building permit. At that time, Contessa advised Welch that the owner's name was Charles B. Hill. Hill paid Contessa a total of $45,000.00 for construction of the house. In January 1984, Welch slowed construction on the house because Contessa did not pay him his construction draws when they were due. Until this time, Contessa had instructed Hill not to discuss construction with any of the workmen on the site, but to bring any concerns directly to Contessa. Additionally, Contessa had instructed Welch not to deal directly with Mr. Hill, but instead to discuss all construction matters directly with Contessa. Because of the slowdown in construction, Hill and Welch discussed the matter between themselves. It was at this time that Hill learned that Welch was the licensed contractor, and not Contessa. Hill then began dealing directly with Welch. Welch completed the construction upon payment of $8,842.00 paid directly by Hill to Welch. Contessa, in the name of Cavalier Development and Building Corporation filed a mechanics lien as a contractor against the Hill property on May 16, 1984.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Professional Regulation, Division of Real Estate, enter a final order suspending the license of Victor L. Contessa for a period of five (5) years and assessing an administrative fine against Victor L. Contessa in the amount of $1,000.00. DONE AND ENTERED this 13th day of August, 1985, at Tallahassee Florida. DIANE K. KIESLING 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 13th day of August, 1985. COPIES FURNISHED: James H. Gillis, Esquire Staff Attorney Department of professional Regulation Division of Real Estate 400 West Robinson Street Orlando, Florida 32801 Victor L. Contessa Box 566 Port Salerno, Florida 33492 Victor L. Contessa 101 Santa Lucia Avenue West Palm Beach, Florida 33492 Salvatore A. Carpino, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Fred Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Harold Huff, Director Division of Real Estate 400 West Robinson Street Orlando, Florida 32801
The Issue The primary factual issue was whether the company which the Respondent had qualified was in fact the contractor on the job from which the allegations in the Amended Administrative Complaint arose. The Petitioner submitted post hearing findings of fact in the form of a proposed recommended order. To the extent that the proposed findings of fact have not been included in this order, they are specifically rejected as being irrelevant, not being based upon the most credible evidence, or not being findings of fact.
Findings Of Fact The Respondent, Edward Ryan, is a certified building contractor holding license number C3 C006481 and was the qualifying agent for Behr Contracting, Inc. (thereafter "Behr Contracting"), at all times relevant to the allegations of the Amended Administrative Complaint. Behr Contracting was, and is a business engaging in, contracting, selling building materials, and mortgage brokerage. Its operations as a mortgage broker are now carried on under a separate corporation; however, at the time involved in these proceedings, its mortgage brokerage operation was carried out in the name of Behr Contracting, Inc. Willie Mae Williams resides at 1451 Northwest 92nd Street, Miami, Florida. In 1980, Ms. Williams had extensive modifications made to her house at the foregoing address. With regard to the work on her house, Ms Williams' initial contact was with S. J. (Jerome) Farmer. Farmer was an independent contractor who was doing home repairs in early 1980 to several homes close to the Williams home. He was not doing these jobs as an employee of Behr Contracting, and no evidence was introduced that at said time he was an employee of Behr Contracting. After he had already begun working on the Williams home, Farmer approached the Respondent and requested Respondent's assistance in helping him estimate additional repairs and modifications to Ms. Williams' home and assistance in obtaining the financing for this job. Farmer was not affiliated in any manner with Behr Contracting. The Respondent arranged for an estimator to assist Farmer in estimating the cost of the project and in obtaining financing for the project. (Testimony of Ryan, Tr. 58 et seq.) This estimator had two contract forms signed by Ms. Williams, one for financing and one for construction. These documents were identified by Ms. Williams and were received into the record. (See Petitioner's Exhibits 2 and 3.) Petitioner's Exhibit 2 is the contract between Behr Contracting and Ms. Williams for the financing of the modifications to the Williams house. Financing for the project was obtained through the mortgage brokerage operation of Behr Contracting and the money funneled through Behr Contracting to pay for materials purchased through Behr's building materials operation. Ms. Williams has made payments and is making payments as required under said contract to the finance company, Uni Credit of Jacksonville, Florida. Behr Contracting provided cabinets, windows and certain appliances, to include a dishwasher. The Respondent was at Ms. Williams' house approximately three times prior to the delivery of building materials from Behr Contracting. (Testimony of Ryan, Tr. 23.) On none of these occasions was the Respondent there as a building contractor qualifying Behr Contracting. At all times, Farmer was in charge of the project. (See testimony of Williams, Tr. 184.) Farmer was the contractor in fact. Subsequent to installation of the dishwasher, the Respondent was present at the Williams house often because of Ms Williams' complaints about the dishwasher. The Respondent replaced this dishwasher and had Ms. Williams' septic tank pumped in order to solve the drainage problem which was causing the dishwasher to malfunction. This was done to honor the warranty on the dishwasher. (Supra, Tr. 45-51.) A salesman for Behr Contracting gave Ms. Williams an estimate on both the contracting and on the financing for the modifications and remodeling of the Williams house. Under its business practices, Behr Contracting disapproved or rejected the contract for construction, yet approved the financing contract. Approval of a construction contract in the amount of the instant contract, over $11,000, would have required an officer's approval. (See testimony of Stanley Weiss, Tr. 21-28.) Although Ms. Williams identified her signature on the purported construction contract (Petitioner's Exhibit 3), she could not identify the signature appearing on the lefthand side of the page at the bottom of the contract in the area of "Agent" and "Officer." This signature also could not be identified by Stanley Weiss or Margaret Behr, officers of Behr Contracting. It was not the signature of Weiss, Ms Behr or the Respondent, who were the only officers of the corporation authorized to approve a contract of this amount at the time that this contract was prepared. This contract (Petitioner's Exhibit 3) was never accepted by Behr Contracting (See testimony of Weiss, Tr. 35.) Although a copy of Petitioner's Exhibit 3 was discovered by Weiss in the files of Behr Contracting, this was a photo copy given to Weiss by the Respondents who had received it from the Board's investigators when the Respondent first spoke to them about this case. (See page 8, deposition of Ryan taken September 17, 1982; see pages 3, 4 and 8, deposition of Weiss; testimony of Ryan, Tr. 70-75; testimony of Weiss, Tr. 10-12.) The Respondent's involvement in this matter was "limited to providing gratuitous advice to Farmer at Farmer's request on one occasion, concerning a broken major waste drain, and representing Behr Contracting who was a major supplier of materials and appliances for the job. It is specifically found that the Petitioner failed to establish the existence of a construction contract between Ms. Williams and Behr Contracting. Regarding the allegations that the Respondent abandoned the job, the Respondent caused the dishwasher supplied by Behr Contracting to be replaced under warranty service. The septic tank at the Williams house was pumped and cleaned at the request of Uni Credit in an attempt to solve the problem. Finally, over a year after the job had begun, the Respondent had the septic tank and drainfeild rebuilt and solved Ms. Williams' drainage problems. This last action was taken under threat of prosecution by the Board's investigators and was done in spite of the fact, which is uncontroverted, that the construction did not address modifications to the plumbing in the house. After the Respondent had taken these actions, Ms. Williams than wanted the cabinets and other work, which had been done by Farmer, replaced because of water damage caused by the drainage problem.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Amended Administrative Complaint against the Respondent, Edward Ryan, be dismissed. DONE and RECOMMENDED this 20th day of September, 1983, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of September, 1983 COPIES FURNISHED: Michael J. Cohen, Esquire Kristin Building, Suite 101 2715 East Oakland Park Boulevard Fort Lauderdale, Florida 32206 Mr. Edward Ryan 19762 Bel Aire Drive Miami, Florida 33138 Frederick Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 James Linnan, Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32202
The Issue The issue is whether Respondent undertook to act as a contractor without a license as charged in the Administrative Complaints, and if so, what disciplinary action should be taken.
Findings Of Fact Pursuant to Section 20.165, the Division of Professions is a subordinate unit of the Department of Business and Professional Regulation (the Department). The Department provides administrative support, including prosecutorial support to the Construction Industry Licensing Board (the Board), which is also located within the Department. Mr. Grandmont is not currently licensed as a State Registered or State Certified Contractor in this state, nor has he ever been licensed by the Board. Mr. Grandmont's last known address is 355 China Berry Circle, Davenport, Florida. He was provided notice of the hearing at that address, and at 7733 Park Road, Charlotte, North Carolina 28210, which is the address he used when demanding a hearing on disputed facts in two of these cases. In DOAH Case No. 06-3279, he provided no address in his demand for a hearing. All attempts by U. S. Mail to notify Mr. Grandmont of the hearing, were returned. Mr. Grandmont is deemed to have known of the time, date, and place of the hearing, and is deemed to have waived his appearance at the hearing. On November 11, 2005, subsequent to Hurricane Wilma, Robert L. Coe, of Lake Worth, Florida, was contacted by Mr. Grandmont, who offered to repair his damaged mobile home. He provided a written estimate of $10,500. The estimate contained a list of 11 items requiring repair, and stated that he would accomplish the repair of them. He demanded a $4,200 down payment, which Mr. Coe provided in a draft drawn on Fidelity Cash Reserves, and dated November 11, 2005. Mr. Coe never saw Mr. Grandmont again. The repairs set forth in the written estimate were not accomplished. The draft, however, was negotiated by Mr. Grandmont. On November 12, 2005, subsequent to Hurricane Wilma, Joseph Webster, of Lake Worth, Florida, was contacted by Mr. Grandmont, who offered to repair his damaged residence. Mr. Grandmont discussed charging $13,500 in return for repairing Mr. Webster's residence. After negotiations, Mr. Grandmont agreed to do it for $11,500. No written estimate or contract was prepared. Mr. Grandmont demanded $5,750 payment in advance. Mr. Webster rounded off the down payment to $6,000 and presented Mr. Grandmont an official check of the Taunton Federal Credit Union, of Taunton, Massachusetts, for that amount. The check was negotiated by Mr. Grandmont, but the promised repairs were not accomplished. On November 4, 2005, subsequent to Hurricane Wilma, Ella Arseneau, of Lake Worth, Florida, was contacted by Mr. Grandmont, who offered to replace her roof. He provided an estimate of $5,500 in return for repairing Ms. Arseneau's residence. He demanded that she pay $3,500 in advance, which Ms. Arseneau provided by presenting Mr. Grandmont a check for $3,500, drawn on an account in Wachovia Bank. The check was negotiated by Mr. Grandmont, but the roof was not repaired as promised. Mr. Coe is 78 years of age, Mr. Webster is 85, and Ms. Arseneau is 77.
Recommendation Based upon the Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation impose a fine upon Clifford Grandmont in the amount of $30,000. DONE AND ENTERED this 28th day of November, 2006, in Tallahassee, Leon County, Florida. S HARRY L. HOOPER 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 28th of November, 2006. COPIES FURNISHED: Brian A. Higgins, Esquire Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202 Clifford Grandmont 7733 Park Road Charlotte, North Carolina 28210 Nancy S. Terrel, Hearing Officer Office of the General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Simone Marstiller, Secretary Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Josefina Tamayo, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
Findings Of Fact The Respondent, at all times material hereto, was a licensed registered "residential contractor." He was not registered or licensed as a general or building contractor, however, as Respondent himself acknowledged. See also, Petitioner's Exhibit 1 in evidence. The Petitioner is an agency of the State of Florida charged pursuant to the provisions of Chapter 489, Florida Statutes, with establishing licensure standards for building contractors of all types in the State of Florida, and with enforcing the various limitations on practice as a contractor embodied in that chapter. On or about January 28, 1986, the Respondent contracted with one Harold Martin, M.D., to build Dr. Martin a commercial office building in Leon County, Florida. The contract specified construction of all phases of the building project except the parking lot and the landscaping. The Respondent submitted a budget for the construction work to Dr. Martin depicting a total proposed cost for the project of $134,882. The Respondent performed substantial work on the office building in January and February of 1986. In March of 1986, due to a dispute which arose between the Respondent and Dr. Martin concerning the cost and progress of the construction project, Dr. Martin terminated the Respondent's service and contract and retained another contractor to finish the job, which was done. The Respondent established that when the contract was terminated, the building was approximately 65 percent complete. It is undisputed that the Respondent did perform a substantial amount of work on the office building pursuant to the contract with Dr. Martin. On March 27, 1986, the Respondent filed a claim of lien against the owner, Harold Martin, in which the Respondent stated that he had managed the construction of the office building in question and had performed $23,300 worth of work thereon. The Respondent also provided Dr. Martin with a Contractor's Affidavit, in which he certified to the owner that all lienors, except one, had been paid. The Respondent had contracted to perform the work after it had been started by another contractor retained by Dr. Martin, whom Dr. Martin had also terminated because he was not pleased with the progress and the quality of work of that first contractor. The Respondent established that one of the members of the Board of Directors of his corporation was a licensed general contractor, but admitted that that general contractor and board member had performed no work with regard to Dr. Martin's office building. The Respondent testified that another general contractor came to the job site from time to time to supposedly oversee the job. However, it was not established that any other general contractor, in the course of his practice, had any nexus with the Martin contract nor the performance of any construction on the building at times when the Respondent was performing construction thereon in January and February of 1986. This is demonstrated especially because of the fact that the Respondent never paid any other general contractor any money for any work or supervision performed with regard to this job, nor had Dr. Martin paid any other general contractor for such duties during the time that the Respondent was performing work on the building in question.
Recommendation Having considered the foregoing findings of fact conclusions of law, the evidence of record, and the candor and demeanor of the witnesses, it is therefore RECOMMENDED that a Final Order be entered by the Construction Industry Licensing Board, in accordance with disciplinary guideline Rule 21E-17.001(3), Florida Administrative Code, according the Respondent the penalty of a Letter of Guidance. DONE and ENTERED this 23rd day of December, 1987, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF 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 December, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-2958 Petitioner's Proposed Findings of Fact: Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. COPIES FURNISHED: William O'Neil, III, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 Mr. James L. Washington 320 West Pershing Street Tallahassee, Florida 32301 Mr. Fred Seely Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32201
Findings Of Fact Roger Newbold was employed by Allen Electric Company, Inc., as a laborer working on its contract with the State. Newbold was employed during two different periods. The first time was prior to January 1, 1977, and the second, from March 13, 1977, to May 22, 1977. The addition to the Polk County Correctional Institution was bid in two phases; the first for heavy construction for site preparation, and the second, the actual building construction. Allen Electric Company, - Inc., had a contract from the general contractor during the first phase to install the main electrical distribution facilities on the site. All of this work was not associated with and carried on prior to the commencement of building construction. The heavy construction was in progress during Newbold's first period of employment with Allen Electric Company, Inc. Allen Electric Company was also a subcontractor with Delta Electric Company on the second phase of construction; however, Allen Electric Company did not do any building construction. They subcontracted with Delta to install secondary distribution lines and perimeter fence lighting on the site. See Delta Electric Company contract, late filed exhibit No. 7. Allen Electric Company did not go into the building with their workmen because their contract called for them to stop five (5) feet outside the building with the secondary distribution lines. All work and wiring done from this point into the building was carried on by Delta Electric. Newbold's job during his entire employment with Allen electric was to dig ditches and lay conduit. The conduit runs then were reinforced with concrete poured over reinforcing steel. During his entire employment, he was involved in digging the necessary ditches, setting the reinforcing rods, and pouring the concrete. The rate for heavy construction laborers under wage rate 398-W filed as a portion of late filed exhibit No. 7 was three dollars and thirty-six cents ($3.36) per hour. The wage rate for laborers working on building construction pursuant to wage rate 397-W also filed as a portion of late filed exhibit No. 7 was six dollars and fifteen cents ($6.15) per hour. Wage scale 397-W specifically states that it is applicable to nonresident building construction. All of the skills listed on the wage rate apply specifically to building construction except the general term "laborer." The record shows that the work done by Allen Electric Company, Inc., in the building construction phase was the same type of work undertaken by Allen Electric in the heavy construction phase. In both phases, Newbold was engaged in exactly the same duties. Newbold did not work on building construction but on laying conduit for secondary distribution systems and perimeter lighting systems during the second phase. All of this work took place outside of the building.
Recommendation The Hearing Officer recommends that the claim of Roger Newbold be dismissed by the agency. DONE and ENTERED this 5th day of 1977, in Tallahassee, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Marvin Woods, Esquire 440 S. Florida Avenue Post Office Box AR Lakeland, Florida 33801 David A. Perry, Esquire Corporate Officer Allen Electric Company, Inc. 1271 LaQuinta Drive Orlando, Florida 32809 Mr. Luther J. Moore Administrator of Prevailing Wage Department of Commerce Division of Labor 1321 Executive Center Drive Fast Tallahassee, Florida 32301
Findings Of Fact At all times pertinent to the allegations contained herein, Respondent was licensed by the State of Florida as a registered real estate broker under license #0001869, which was issued to him as a broker in care of American Heritage Realty, Inc., 102 East Leeland Heights Boulevard, Lehigh, Florida 33936. At all times pertinent to the allegations contained herein, Respondent owned American Heritage Builders, Inc. (AHB). Rudolph L. Ferster, a certified contractor, served as vice-president in charge of construction for American Heritage Builders, Inc., from August 1978 until October 13, 1984. As a licensed contractor, he qualified American Heritage Builders as a residential contractor in the State of Florida. During the time he was with AHB, he supervised the construction of nearly 100 houses for the company. Most of these houses were one of four basic models. When Mr. Ferster left his association with AHB, another contractor, Warren Fuller, had been hired by Respondent to work with the company. He does not know whether Mr. Fuller ever qualified AHB or not. On January 23, 1983, employees of the Respondent entered into a contract with William D. Thomas for the construction and purchase of a lot and house to be constructed thereon by AHB. Contract price was $30,737 for the entire package and Mr. Thomas put down a $4,000 deposit. The balance of $26,737 was to be paid at the start of construction which, in the contract, was stated to be April 15, 1983. The Administrative Complaint alleges that Respondent delayed construction of the Thomas property for over two years and then abandoned it, causing a $6,000 plus loss to Mr. Thomas. The Thomas property was contracted initially to be a shell home. Mr. Thomas was going to do much of the work himself. When Respondent could no longer do the work due to the lack of licensure status, Mr. Thomas contracted with Fred D. Elliott, a certified residential contractor to complete the property which at the time was 50 percent done. Respondent took Mr. Elliott to Mr. Thomas with whom Elliott made an agreement directly. At that time, Mr. Thomas still owed approximately $8,000 on the work agreed upon in the original contract. The additional $6,000 alleged in the Administrative Complaint was for work agreed upon by Mr. Thomas over and above that called for in the initial contract and was in no way connected to the work left undone by Respondent. On January 30, 1984, employees of the Respondent entered into a similar contract with Clarence and Lillian Tap for the construction and purchase of a house and lot in Lehigh Acres to be built by AHB. Mr. Tap intended to pay cash for his purchase and agreed to the construction of a residence on a particular lot which had been shown to him by Respondent's employees. Several days after signing the contract, however, Respondent's employees telephoned him telling him that though the lot he had selected was not available, he could have the lot next door. Since the lot he had selected was a corner lot and the lot subsequently offered was an interior lot, he rejected this offer and Respondent's employees offered to show him other lots with the caveat that if the new lot he selected was more expensive than the original, he would have to pay the difference. Mr. Tap agreed and selected a new lot for an additional cost of $2,500. The original contract was for a total purchase price of $34,995 with $18,250 to be paid down at start of construction on March 1, 1984, and three additional payments to be made periodically at various stages of construction. When the new lot was decided upon, however, a new contract was drawn up and signed by the parties which reflected the new purchase price. It also called for Mr. Tap to apply for a mortgage in the amount of $8,500 with appropriate adjustments to other cash payments. At the time, Mr. Tap was not sure he would be able to make the total cash payment called for since his prior owned mobile home had not yet sold. Because of this development regarding the application for mortgage, Respondent included this parcel in the security given for his half million dollar line of credit with Florida Federal Savings and Loan. As Mr. Tap was not going to make the total cash payment, Respondent would need to secure a fund draw from Florida Federal in order to complete construction. This created a substantial problem not only for Respondent, but for Tap as well. The Taps did not have to take out a mortgage after all, but were able to pay cash for the entire property when it was completed. However, because of financial difficulties that had come up between Respondent and Financial Federal by that time, the lending institution was unwilling to release the Tap property from its security agreement even though Respondent was willing to pay the entire amount due on that property. When the Taps could get no satisfaction from Respondent, they hired an attorney who got him to sign a warranty deed in favor of the Taps, transferring title to the property in question. At the time, Respondent and the Taps' attorney both knew that there was still a security interest in the property in the hands of Florida Federal but Respondent was of the opinion, based on conversations and correspondence he had with the institution, that they were going to release the Tap property. As a result, he signed the warranty deed and advised the Taps at the time that they should receive their copy of the deed within four to six weeks. This time was supposedly sufficient to allow payment of the outstanding obligation to Florida Federal and Florida Federal's recordation of the deed from AHB to the Taps. However, Florida Federal refused to release the Taps' property and has subsequently initiated foreclosure action against it to recover the $30,400 they claim to be due and owing on that section of the line of credit. Mr. Tap has offered to pay the entire $30,400 to Florida Federal in addition to the full amount of the contract price he has already paid to Respondent, but Florida Federal refuses to accept any partial payment. Instead, it insists upon satisfaction of the entire line of credit which now is approximately $200,000. On April 17, 1984, employees of the Respondent entered into a contract with Davis and Reba Williamson as purchasers of a new house to be constructed by AHB on a lot already owned by the Williamsons which they had purchased separately from the Lehigh Corporation for $8,000. Mr. Williamson paid AHB approximately $12,000 down payment on a home to cost $34,245. The house was not completed until October 1985, at which time the Williamsons took possession. They noticed that mechanics' liens had been placed on the property but these were satisfied by the Respondent with funds coming from Financial Federal prior to the Williamsons taking possession. It would appear that the liens were the result of the failure of the actual building contractor, Mr. Price, of New Homes of Lee County, to pay suppliers and subcontractors. When Mr. Williamson looked at the permit posted outside the construction, he first learned AHB was not actually doing the construction. Prior to that time, though Respondent, Mr. Anglickis had not so represented, Williamson had assumed AHB was the actual constructor. When Mr. Williamson spoke with Mr. Price about the liens, he was advised that the construction had stopped because Respondent owed Price money. Respondent denies this and there is no evidence presented by either side to establish the truth of that allegation. The house was subsequently completed by Mr. Williamson acting as his own contractor and hiring subcontractors to do the actual work through the assistance of Mr. Ohlhausen, the DPR investigator, to whom he had complained previously. The materialmen and subcontractors were paid by Mr. Anglickis who issued funds from the construction loan. No additional funds were required of Mr. Williamson. Respondent did not do the final construction to complete the property because, not being a licensed contractor, he could not lawfully do so. On July 26, 1984, the employees of the Respondent entered into a contract with Samuel J. and Dorothy Sapp to construct a house on a lot already owned by the Sapps for a total price of $56,347. The contract called for the Sapps to apply for a mortgage in the amount of $36,000. To facilitate the transaction, the Sapps conveyed the lot they owned to AHB. Respondent admits the home was not built even though the lot was conveyed and Mr. Sapp paid in a deposit of $21,324. When the property was not constructed, Respondent reimbursed Mr. Sapp in the amount of $20,000 which constituted his deposit minus certain expenses incurred for such things as survey fee, attorney fee, mortgage fees and the like. Respondent claims that prior to 1978 when Mr. Ferster came on board, there had always been a licensed contractor to qualify AHB. Initially, upon first purchasing the business, Respondent used all licensed contractors who had worked for the corporation when it was owned by Lehigh Corporation. Respondent assumed that the contractors he utilized were doing the same thing for him as the owner of the corporation in order to keep matters legal as they had done when the corporation was owned by Lehigh Corporation, and for many years this was the case. Mr. Ferster maintained AHB as a qualified contractor until he left in 1984. It was at point that the new contractors utilized by Respondent, Mr. Price in particular, failed to qualify the corporation with their licenses. However, Respondent contends, and the evidence seems to establish, that at no time did Respondent ever represent himself as a licensed contractor to the buyer of the homes in question here. In fact, he did not even speak with them until well after the contracts were signed by the purchasers and his signature appearing thereon in each case is an ex post facto action on his part. The problems which confront Respondent herein deal with his relationship with Florida Federal with whom he had established a half million dollar line of credit. Just about the time these current houses were coming up for construction, Respondent's relationship with Florida Federal deteriorated. It well may be that his financial arrangements with the institution were less than satisfactory. Evidence of this was not forthcoming from either party. However, it has been shown that each of the properties in question was made a part of the security for Respondent's line of credit which had fallen delinquent. Florida Federal indicated its intention to foreclose and, with few exceptions, took the position that the mortgage which it held on Respondent's properties did not provide for releases of individual parcels. Though this may have been the case, and the mortgage was not introduced, Respondent testified, and there is no reason to disbelieve him, that prior to the time in question, as a practice, Florida Federal did release individual parcels upon payment of the amount represented as the construction loan in each case. Respondent assumed that this practice would continue but in the case of the Sapps' property, it did not. Respondent has, from the very beginning, made a good faith effort to secure the release of the Taps' property which should not have been made a portion of the security in the first place. The Williamson property was released and they acquired a clear title to it. When the Tap property was completed and ready for closing, Mr. Tap brought the $8,500 still outstanding with him to the closing. Florida Federal, however, would not accept this money because it was not the full payoff on Respondent's construction loan. While Respondent brought with him the amount he thought was due, the figure was wrong and Florida Federal would not accept the amount offered since both his amount and the $8,500 Tap payment still did not constitute the full amount due under the construction loan. Thereafter, Florida Federal would not accept the correct amount due on this particular property even though Respondent offered and had available to him sufficient funds to make the full payment. The $500,000 line of credit was not renewed by the Respondent at his own choice when it became time for the rollover. However, because there were still four homes still in work, Respondent offered to roll over a lesser amount, $161,000, which was agreed upon by Florida Federal by letter dated March 14, 1985. At the time of this letter, Mr. Tap's property had been completed three months previously and Respondent had given Tap a warranty deed. Respondent asked Florida Federal on an almost daily basis for the payoff on the Tap loan so that he could have that portion of the mortgagee released. However, he was never given it. At the time, Respondent was working with Florida Federal to get as many properties released as he could and though Florida Federal verbally agreed to work with Respondent, it appears he never got any cooperation. In fact, by letter dated April 3, 1985, Financial indicated that if the unpaid principal balance was not paid in full by April 13, 1985, foreclosure action would be initiated. When Respondent received this letter he immediately called Florida Federal. He was advised orally that he could have a second chance and that papers would be forwarded for him to sign, but he never received them. Instead, on April 18, 1985, he received a letter stating that he had failed to meet the terms and conditions of the previous offer and that it was rescinded. Respondent wrote back on April 24 protesting the decision and alleging a mistake. Nothing was done until July 17, almost three months later, when he was again advised in writing that the bank would consider a proposal from him. Respondent responded quickly and on August 27, received a reply from the bank apologizing for the failure to respond to his proposal and indicating that the matter was still open for negotiation. Nonetheless, Mr. Tap has still not been given the opportunity to pay off his property. Florida Federal refuses to accept any pay off for individual homes unless the entire line of credit is paid in full. During the period of these negotiations, Florida Federal accepted two other loans for Respondent's line of credit but has refused to advance any funds under these loans. One of these is the Sapp house. Florida Federal took the Sapp lot previously deeded to AHB as security for the line of credit and refuses to release it though no funds have been advanced for any construction on that lot. Respondent, in addition to reimbursing Mr. Sapp $20,000 of his deposit, has offered payment for the lot or an exchange of lots, but Mr. Sapp has declined. With regard to the Tap house, covered by a $30,400 construction loan, Respondent has offered Florida Federal $50,000 in cash to release this property but the institution refuses insisting that the full line of credit be paid off. Respondent contends that he has never received a complaint from Mr. Williamson or any of the other individuals listed in the Administrative Complaint. This is so found. Charles Matheny, assistant to the President of Lehigh Corporation, the developer of Lehigh Acres, has known the Respondent for nearly 19 years, having first met him when Respondent worked for the corporation in advertising and promotion. Respondent left Lehigh Corporation at some point in the interim. When he did so, he purchased certain assets of the corporation which included the name American Heritage Builders, Inc., and the model site owned by the corporation. At that point, Respondent went in business for himself and started American Heritage Realty in order to market the property and homes he built. According to Mr. Matheny, Respondent was active in little league in years past though he had, at the time, no children of his own, and when doing so, was instrumental in molding the character of the children who played for him for the better. Respondent has also been active in the junior Chamber of Commerce and reportedly was President of the statewide organization. He has also been active in other community activities such as the local Chamber of Commerce and the Community Day Care Center. He is known to be quite charitable and devotes a considerable amount of time and money to charitable activities. As Mr. Matheny knows it, Respondent's reputation for truth and honesty in the community is good. He has never heard any reports to the contrary. Respondent was interviewed by Mr. Ohlhausen in 1984 in regard to a complaint filed by the Construction Industry Licensing Board relating to Respondent serving as a contractor without a license. When Ohlhausen advised Respondent he was operating in violation of the law, Respondent appeared not be to aware of this. When so advised, he immediately agreed to sign a cease and desist agreement and stopped all further construction activity. He cooperated fully with efforts of the Department to get the properties completed and in the hands of the owners.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law it is, therefore: RECOMMENDED that the Administrative Complaint against Respondent herein be dismissed. RECOMMENDED in Tallahassee, Leon County, Florida, this 20th day of April, 1988. ARNOLD H. POLL0CK Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1050 (904) 488-9765 Filed with the Clerk of the Division of Administrative Hearings this 20th day of April, 1988. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 87-2619 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. By the Petitioner 1 - 4. Accepted and incorporated herein. Accepted and incorporated herein. Rejected as contra to the weight of the evidence. Accepted and incorporated herein. Rejected as contra to the weight of the evidence. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. Irrelevant. By the Respondent Not a Finding of Fact. Not a Finding of Fact - more a comment on the pleadings. 3 - 4. Accepted and incorporated herein. 5a. Accepted and incorporated herein. 5b. Accepted and incorporated herein. 5c. Accepted and incorporated herein. 5d. Accepted and incorporated herein. 5e. Accepted and incorporated herein. 5f. Accepted and incorporated herein. 5g. Accepted and incorporated herein. 6. Accepted and incorporated herein. COPIES FURNISHED: James H. Gillis, Esquire DPR, Division of Real Estate Post Office Box 1900 Orlando, Florida 32801 Howard Anderson, Esquire Post Office Box 767384 Roswell, Georgia 30076-7384 Darlene F. Keller Acting Executive Director DPR, Division of Real Estate Post Office Box 1900 Orlando, Florida 32801 William Bilenky, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
The Issue The issue for consideration in this hearing is whether Respondent’s license as a residential contractor in Florida should be disciplined because of the matters alleged in the Administrative Complaint filed herein.
Findings Of Fact At all times pertinent to the issues herein, Petitioner, Construction Industry Licensing Board, was the state agency in Florida responsible for the licensing of contractors and the regulation of the construction industry in this state. Respondent, Kenneth Ronald Boaz, was a residential contractor holding license CR C035360. He was the qualifying agent for Revival Remodelers, and was doing business under that name. On or about August 23, 1996, Respondent, doing business as Revival Remodelers, entered into a contract with Vicky L. Smith to construct a 20 by 24-foot room addition to her residence located at 13281 Clay Avenue in Largo, Florida. The contract price for the addition was listed as $25,000, plus permit fees, and Respondent accepted a partial payment of $21,072.60 from Ms. Smith. Respondent was instrumental in helping Ms. Smith get the financing for the project. On September 5, 1996, Respondent obtained permit No. 146699 from the Pinellas County Building Department. Before starting construction on the room, Respondent arranged for several large trees to be removed from the area of Ms. Smith’s back yard near where the rear wall of the addition would be located. When the trees were removed, the holes left by their removal were to be filled with dirt. Though Respondent arranged for the trees to be moved, Ms. Smith paid an additional $680.00 to the sub-contractor who removed them. Respondent was aware that the trees had been removed and the holes filled with dirt. Respondent began work shortly after the removal of the trees and the filling of the holes. Ms. Smith claims she did not see anyone do any compacting of the soil where the trees had been removed, but the footers and slab were poured and finished. Whereas the Pinellas County Building Code does not require a soil compaction test, it provides that foundations shall be built on undisturbed soil of properly compacted fill. At Ms. Smith’s request, construction slowed down but continued while she tried to find additional financing to complete the work. Finally, Respondent and Ms. Smith agreed the work would cease until she could obtain the amount remaining due under the project. At this point, Ms. Smith owed Respondent approximately $4,000. Ms. Smith claims that even before this, however, she noticed cracking in the concrete slab. This worried her because she wanted to lay tile as flooring. But when she mentioned this to the Respondent, he told her not to worry as he would take care of it. He did not do so, however. Because of her concern, in the Spring of 1999, Ms. Smith called the Building Department in Clearwater and the building inspector from the county came out to inspect the work. The inspector issued a red tag for the work, signifying it was unacceptable. Ms. Smith also contacted other contractors to see if tile could be successfully laid on that slab. Each has said it could not. No other contractor with whom she has spoken is willing to take over the job without additional soil compaction. One contractor gave her an estimate of $47,500 to re-build the room. Another contractor quoted a price of $44,800, but both include items not on the contract she had with Respondent. Respondent last worked on this job in December 1996. Since that time, Ms. Smith has talked with him about the quality of his work and has had two mediation sessions with him without any success. The room has not been completed because there is substantial question whether the existing work done by Respondent can be successfully completed. The defects in the construction are manifested by the following: There is a separation of the additional wall from the existing house wall of from between 1/2 to 1 inch. The roof of the addition leaks and the insulation is moldy and falling. There are cracks all over the additional floor and outside patio slab. The corners of the addition are dropping. Cinder blocks in the addition walls are cracking The lintel is broken in three places. Ms. Smith has done no more construction on the addition because she filed her complaint with the Department and is waiting to see what is done. However, she has painted and sealed the exterior walls. The leak is not through the wall cracks but through the roof. After her complaint, Respondent had someone from PSI, an engineering consulting firm, come out and perform a soils compaction test. As a result of that test, several different formulae were offered to fix the problem, but Ms. Smith was not satisfied, considering it no more than a "cover-up." Finally, Respondent offered her a structural solution to the problem that would remove the red tag. Ms. Smith would put the balance owed, plus some additional money into an escrow account, whereupon Respondent would fix the problem. However, because Ms. Smith no longer has any confidence in the Respondent, she does not want him to do any of the work. She contends that Respondent never agreed to fix the problem if she would put what she stilled owed him in escrow - only if she would add to it. Kevin McGinley is a licensed general contractor who in 1997 was asked by Ms. Smith to give her an estimate on making repairs to and completing the addition started by Respondent. His examination of the site showed severe settling on the addition. The work appeared to have been built on an uncompacted pad which caused settling, and McGinley did not want to be responsible for the work. Therefore, he gave Ms. Smith an estimate to tear down what had been done by Respondent and to rebuild from scratch. His work would include an inspection by a soils engineer to see if the existing soil would support the project. While cracks in a slab can be repaired, in the instant case, without knowing what caused the problem, he would not want to try to fix it. Wendell G. Wardell, a building inspector for Pinellas County, first inspected this project on September 16, 1996, when he went out for the slab inspection. There were several problems with the site, none of which related to the instant problem, and all of which were cleared up by November 21, 1996. He was again sent to the site somewhat later based upon a complaint by the owner. On this visit he saw cracking and settlement of the slab and he issued the red tag. Neither Respondent nor the owner called for a re-inspection that would be required before work can resume because work was not resumed. Mr. Wardell noted that a compaction test was not required by the county before the permit was issued in this case, though sometime it is required. Mr. Yaxley, a consulting engineer, visited the site in April 1998. Ms. Smith was present at the time. He observed the cracking in the floors and walls and the mildew in the roof. The most obvious defects were the 1/4-inch cracks in the floors and walls of the addition. After studying the site and the results from the two other laboratories that tested the site, he concluded that the removal of the trees caused the holes several feet deep that were then filled with 20 square yards of dirt. This fill dirt should have been compacted in a reasonable manner, and it was not. Yaxley reasoned that Respondent knew of the holes and the placement of the fill dirt and he should have done tests to ensure the compacting was done properly. The use of a bob-cat, a front-end loader, as used here, did not provide the appropriate compaction. However, removal of the trees was a clue that a closer look at the soil was required. Yaxley examined the laboratory work done on the property and determined there are two voids left under the soil from the removal of the trees. One is about 18 inches down and the other at about three to four feet down. Compaction may or may not cure this. Settling may continue for a long time. While one void could have been an unknown factor, the existence of the three trees was a known factor, and proper caution and judgment would have called for further inquiry to determine the status of the sub-surface. Respondent claims he had no knowledge of any voids in the soil. He compacted with water and soil in layers but this compacting was done under the slab area, not where the holes were filled. He used a concrete contractor to do this work and has always found it to be consistent with acceptable standards before. There are several other defects in Respondent’s performance, according to Yaxley. The core of the slab shows no reinforcing of the concrete either by welded steel or fabric fiber mixed in with the concrete; the roof deck is mildewed; there are cracks in the slab and between the main building and the addition; there are step cracks in both the north and east wall of the addition; and the bracing and attachment of the east gable above the concrete block is not adequate. Mr. Yaxley went back to revisit the property on October 5, 1998, and found that as of that time, no corrective work had been done. The problem with the property can be fixed with injections of grout and the installation of pilings. If that were done properly, Ms. Smith would be able to safely install the tile flooring she wants. However, if nothing is done, the cracks will remain and probably get worse. Respondent contends that the removal of the trees did not create holes that required fill. He asserts that the fill dirt brought in was procured at the request of the Building Department that wanted it to construct another swale on the property. Mr. Boaz admits to not using reinforcing steel in the concrete slab he poured. Instead, he ordered the fiber- reinforced concrete at a thickness of more than six inches, which exceeds the code requirement of four inches. He did not know, until he heard Mr. Yaxley’s testimony, that the concrete poured by his sub-contractor was not fiber-fill.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Construction Industry Licensing Board issue a final order in this case finding Respondent guilty of negligence resulting in danger to property, and misconduct in contracting, and imposing an administrative fine of $5,500. It is also recommended that Respondent be ordered to pay restitution to Ms. Vicki Smith in the amount of $21,072.60 or, in the alternative, within 90 days from the date of the final order, undertake such remedial construction activity as is necessary to remove the red tag issued by the Pinellas County Building Department regarding this project. DONE AND ENTERED this 25th day of May, 2000, in Tallahassee, Leon County, Florida. ARNOLD H. POLLOCK 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 25th day of May, 2000. COPIES FURNISHED: Robert A. Crabill, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32388-2202 Warren Knaust, Esquire Knaust & Valente, P.A. 2730 Central Avenue St. Petersburg, Florida 33712 Barbara D. Auger, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Rodney Hurst, Executive Director Construction Industry Licensing Board Department of Business and Professional Regulation 7960 Arlington Expressway, Suite 300 Jacksonville, Florida 32211-7467
The Issue Did Respondent violate Section 489.129(1)(h), Florida Statutes, and, if so, what discipline should be imposed?
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 vested with statutory authority to regulate the practice of contracting under Chapters 455 and 489, Florida Statutes. Respondent is a licensed certified residential contractor in the State of Florida. Respondent's license number, as certified by Julie Odom, Department's Alternate Records Custodian, is CRC 20166. However, the Administrative Complaint alleges the license number to be CR C020166. Respondent's licensure status is "Delinquent, Active." On May 18, 1989, the Department entered a Final Order in DOAH Case No. 88-3308 wherein Respondent was found guilty of violating Section 489.129(1)(h),(j),(k), and (m), Florida Statutes. On September 27, 2000, the City of Cape Coral, Florida, Contractor's Regulatory Board (Board) entered into a Settlement Agreement (Agreement) with Respondent, in regard to a complaint, Case No. 00-01, wherein Respondent was charged with violating the following Sections of the City of Cape Coral Code of Ordinances: 6-10.1:, To make misleading, deceptive, untrue, or fraudulent representations in the practice of his contracting profession; 6-10.8: Diversion of funds or property received for prosecution or completion of a specified construction project or operation when as a result of the diversion, the contractor is or will be unable to fulfill the terms of his obligation or contract; 6-10.10: Failing in any material respect to comply with the provisions of the Code; 6-10.11: Abandoning of a construction project in which the contractor is engaged or under contract as a contractor. A project is to be considered abandoned after 90 days if the contractor terminates the project without notification to the prospective owner and the City and without just cause; and 6-10.13: Being found guilty of fraud or deceit or of gross negligence, incompetence, or misconduct in the practice of contracting. The Agreement provided that Respondent was pleading No Contest to the charges that he violated the aforementioned sections of the City of Cape Coral's Code of Ordinances and that Respondent's plea did not act as an admission of guilt as to the above mentioned charges. The Agreement provided for Respondent's permit pulling privileges to be revoked for a period of 90 days starting August 23, 2000. By an Order dated December 29, 2000, the Board, after hearing and discussing the charges made against Respondent, voted to accept and approve the Agreement. By this Agreement, Respondent's contracting license was disciplined by the City of Cape Coral. The total investigative and prosecution costs to the Department, excluding costs associated with any attorney's time, is $967.09.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, and a review of Chapter 61G4-17, Disciplinary Guidelines, Florida Administrative Code, with consideration for the repeat violation of Section 489.129(1)(h), Florida Statutes, it is RECOMMENDED that the Department enter a final order finding Respondent, Robert Mensching guilty of violating Subsection 489.129(1)(h), Florida Statutes, and for such violation: (a) impose an administrative fine in the amount of $5,000.00; (b) assess costs in the amount of $967.09; and (c) revoke Respondent's Certified Residential Contractor's License. DONE AND ENTERED this 21st day of March, 2003, 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) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 21st day of March, 2003. COPIES FURNISHED: Kimberly V. Clark, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 Robert Mensching 1719 Northeast 23rd Terrace Cape Coral, Florida 33909 Robert Crabill, Executive Director Construction Industry Licensing Board Department of Business and Professional Regulations Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202
