The Issue Whether Respondent owes Petitioner $41,783.69 as alleged in the complaint filed on December 2, 1996.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Background Petitioner, Lenard Powell (Petitioner), is a watermelon farmer in Lake Panasoffkee, Florida. Respondent, Joe Marinaro (Respondent), is a licensed dealer in agricultural products doing business as Atlantic Fruit Company in Fort Pierce, Florida. He has been in the business for more than forty years and has an unblemished record. As a licensed dealer, Respondent is subject to the regulatory authority of the Department of Agriculture and Consumer Services (Department). Respondent has posted a bond written by Reliance Insurance Company, as surety, to assure proper accounting and payment to producers such as Petitioner. In a complaint filed with the Department on December 11, 1996, Petitioner alleged that he entered into an agreement with Howard Bailey (Bailey) on behalf of Tom Lange Company (Lange), a distributor of fresh fruits and vegetables, to market his 1996 watermelon crop. Under that alleged agreement, Lange would advance "up front seed money, $900.00 per trailer for labor advance, when road truck crossed the scales, [and] supply the boxes and cartons which were to be deducted from the final payment." According to the complaint, Petitioner was to pay Lange and Bailey "a fee of one cent per pound on seeded varieties and two cents per pound on seedless watermelons." The complaint goes on to allege that in May 1996, Bailey advised Petitioner that he no longer represented Lange, but now represented Respondent, and "the deal was still the same." Finally, Petitioner has alleged that the final summary from Respondent "had inconsistent weights, document numbers and prices" and that Petitioner's calculations showed an unaccounted for balance of $45,506.97. As amended at hearing, Petitioner now claims he is owed $41,783.63. In his Amended Response, Respondent contends that even though the agreement called for him to have an exclusive right to sell Petitioner's 1996 crop, a portion of the crop was sold directly by Petitioner or Bailey to third parties without Respondent's knowledge. He further contends that the watermelons were to be sold on a twenty percent of gross proceeds commission basis rather than the one and two cents per pound commission basis alleged in the complaint. Respondent also asserts that some of the watermelons were dumped because of spoilage and that a part of the bins or cartons were packed with oversize watermelons, thus "short-counting" the number of melons in each container. This resulted in the buyers making deductions upon delivery of the produce. After taking these factors into consideration, Respondent claims that no money is owed. The Agreement It is customary in the watermelon business to enter into agreements to buy and sell watermelons without a written contract. Therefore, it was not unusual for the parties to base their agreement on a handshake or verbal understanding. Bailey is a "part-time watermelon broker," farmer, and owner of Bailey Farms, Inc., in Schoolcraft, Michigan. Although he says he has been licensed as a dealer in the past, Bailey had no license or bond when these events occurred. Bailey has had dealings with Respondent since around 1989. In 1995, Bailey was involved in a "relationship" with Lange in which they worked "joint deals" splitting profits and commissions. Under that relationship, Bailey would arrange to market a grower's watermelons through Lange's customers and split the profits or commissions with Lange. In November 1995, two Lange representatives (Phil Gumpert and Michael E. Smith) and Bailey met with Petitioner in Wildwood, Florida, for the purpose of exploring the possibility of marketing Petitioner's 1996 crop. Under the arrangement proposed by Lange, Petitioner would receive the proceeds from the sale of his watermelons handled by Lange, less a commission, less the usual and customary weight differences between the gross weight shipped and the net weight paid by buyers, less the advances made by Lange for plants, seeds, materials and supplies, and less deductions for non-conforming watermelons in general, improper sizing, inaccurate counts in bins, and oversizing in cartons. As to the amount of commission, Lange proposed to charge twenty percent of gross sales proceeds. Bailey acknowledges that Petitioner initially balked at paying a twenty percent commission on the ground that amount was too high but contended he eventually agreed to that figure when it was explained there was no incentive for the dealer to get a good price for the watermelons if the dealer was paid a flat one or two cents per pound commission. Petitioner contends, however, that he did not agree with this amount and instead wanted only to pay one cent per pound for seeded watermelons and two cents per pound for seedless watermelons. His version of the events is accepted as being the most credible, and thus it is found that, as of November 1995, there was no agreement on that issue. It is noted that except for the amount of commissions, Petitioner basically agreed with all other terms and conditions discussed by Lange and Bailey. In view of the lack of agreement on the amount of the commission, there was no meeting of the minds by the parties. This was confirmed by Michael Smith, a Lange representative, who described the meeting as simply "exploratory" in nature and nothing more. Sometime after the meeting, Lange sent Petitioner an unsigned copy of a "Marketing Agreement" which contained the terms under which Lange would advance moneys to Petitioner in return for an exclusive right to sell his 1996 crop. The agreement was sent to Petitioner merely "as an example" in the event the parties might reach an agreement. It contained terms and conditions pertaining to commission, grower advances, and other relevant considerations. Paragraph 7 of the agreement called for the dealer to receive "a commission equal to twenty percent (20%) of the final gross selling price of each shipment." After receiving the agreement, Petitioner consulted his attorney, who at that time was his father-in-law. The attorney lined out a part of the provision relating to commissions, and in paragraph 8, he inserted a requirement that the dealer provide Petitioner with a "verified" accounting of the sales. However, the amended agreement was never signed by Petitioner nor returned to Lange or Bailey. Petitioner did not immediately notify Lange orally or in writing that he was dissatisfied with the terms described in the agreement. It was his intention, however, to further negotiate the amount of the commission. A short time later, he contacted Bailey regarding his disagreement with the amount of commission and was told by Bailey, "don't worry about it." Based on this conversation, Petitioner assumed that only a one or two cents commission would be paid and that an agreement had been formed. Bailey never conveyed Petitioner's concerns to Lange. Events Prior to the Harvesting of the Crop Petitioner received and accepted advances of funds for plants, seeds, and materials to produce the watermelons. While the precise amount is not known, it approximated around $40,468.00. A part of these moneys initially came from Bailey and the remainder from Respondent. Petitioner used these funds to plant and harvest his 1996 watermelon crop. In March 1996, Bailey learned that because the venture "was not attractive," Lange was no longer interested in marketing Petitioner's watermelons. Indeed, in his deposition testimony, a Lange representative suggested that an agreement between Lange and Petitioner had never been reached before Lange bowed out of the picture. In any event, because Bailey had cash invested in the venture, and he was in dire need of a new broker with financial backing and customers to buy the watermelons, he contacted Respondent to ascertain if he was interested in the venture. Among other things, Bailey represented that in return for Respondent providing up-front money to Petitioner, Respondent would have an "exclusive right of sale" and they would share in a twenty percent commission. It is noteworthy that Bailey did not show Respondent a copy of the Marketing Agreement previously sent by Lange to Petitioner, and he did not tell Respondent that Petitioner would pay a commission of only one cent per pound for seeded watermelons and two cents per pound for seedless watermelons. Based on Bailey's less than candid representations, Respondent agreed to take Lange's place in the venture. Under their arrangement, Bailey and Respondent had a community of interest in a common purpose, that is, the sale of Petitioner's crop. By virtue of the exclusive right of sale, they had joint control or right to control to whom they sold the watermelons. In addition, the two had joint control or right to control a checking account established in Michigan for that venture. They intended to share profits by splitting the commissions, and they likewise intended to share in any losses. Finally, they both expended their knowledge, time, labor, and skill in furtherance of the joint venture. Around April 1996, Bailey contacted Petitioner and advised him that Lange was no longer in the transaction, but that Respondent's company, Atlantic Fruit Company, would stand in Lange's shoes and handle the watermelons on the same basis as they had previously agreed. Because Respondent had a good reputation and a sufficient bond, Petitioner agreed to the substitution of dealers. Petitioner and Respondent did not discuss the terms and conditions of the agreement, including the amount of commissions to be paid, since they both relied on the representations of Bailey. The Sale of the Produce In all, fifty loads of watermelons were shipped from Petitioner's field at the direction of either Respondent or Bailey. Because Petitioner never received bills of lading for two of those shipments, and he has abandoned a claim as to those two, only forty-eight shipments are in dispute. Without Respondent's knowledge, Petitioner sold eight loads of watermelons directly to third parties and received a total of $21,069.70. These proceeds were used by Petitioner to pay labor costs. Bailey knew and agreed to the third party sales. Bailey sold thirteen loads of watermelons without Respondent's knowledge. On these loads, Bailey was paid a commission of one cent per pound of the weight of the melons, which amount is consistent with the parties' agreement. Bailey did not split the commission he received on these loads with Respondent. These transactions reinforce the view, as more fully discussed below, that Bailey knew that Petitioner had agreed to a different commission basis than the one he described to Respondent. Petitioner kept track of the harvest by making notes in a "log book." The log book contains the date, variety of watermelon, net weights, and price per pound that he was to receive. The book was prepared contemporaneously. In addition to the log book, Petitioner was given a copy of a bill of lading for each truck load of watermelons that was shipped. The bills of lading indicated the weight, variety, broker, and destination and were prepared on forms of either Atlantic Fruit Company or Bailey Farms, Inc. Petitioner's claim is comprised of five categories. First, he is claiming the difference between the twenty percent commission charged by Respondent and the one or two cents commission to which he agreed. Second, he is claiming the value of the weight difference between what the buyer received and what was shipped from his fields and recorded on the bills of lading. Third, he is claiming the difference between what the buyer paid per pound and the price per pound Petitioner reflects in his log book. Fourth, Petitioner is claiming the amount the buyer deducted from the purchase price because of spoilage or short counts. Finally, Petitioner claims the unaccounted weight shortage in watermelons shipped by Bailey to Bailey's cooler in White Springs, Florida. Each of these categories will be discussed below. Twenty percent commission Petitioner first contends he is owed the difference between a twenty percent commission charged on thirty-five shipments by Respondent and the one and two cents per pound commission to which he agreed. The total amount in controversy is $14,503.18. The underlying documentation for these loads is found in Petitioner's Exhibits 1, 5, 7, 9, 10, 12, 13, 15-20, 23- 28, 31, 33-39, and 41-48. The evidence established that, consistent with Petitioner's claim, it is customary in the industry that brokers receive a one cent per pound commission for the sale of seeded watermelons and a two cents per pound commission for the sale of seedless watermelons. While Bailey contended at hearing that some growers were paying a twenty percent commission on seedless (but not seeded) watermelons, he could not identify any such growers. Further, in deposition testimony, Lange acknowledged that it had no customers in Florida in 1996 using that commission basis. Finally, on thirteen loads sold directly by Bailey to third parties, he was paid a one cent per pound commission, which is consistent with Petitioner's position. Given these considerations, the undersigned is persuaded that Petitioner never agreed to a twenty percent commission arrangement. Therefore, Petitioner is only obligated to pay a one cent per pound commission on seeded watermelons and two cents per pound on seedless watermelons sold by Respondent. Petitioner is entitled to reimbursement for the difference between a twenty percent commission and the agreed upon amount. Since it was not shown that Petitioner's suggested amount of $14,503.18 should be modified if adjustments to other claims are made, that amount is found to be appropriate. This amount, however, should be offset by the commission which Respondent should have received from Petitioner for the sale by Petitioner of eight loads of watermelons to third parties. This is because those sales contravened the parties' agreement that Respondent had an exclusive right to sell all of Petitioner's 1996 crop since he had advanced the money to produce and harvest the crop. While Respondent is also entitled to share in the commission received by Bailey for thirteen loads sold by Bailey to third parties without Respondent's knowledge, Respondent's remedy is against Bailey, and not Petitioner. Buyer deductions Petitioner contends that he is owed $7,121.99 for miscellaneous deductions improperly made by the buyers. In this case, the buyers made deductions for short counts, that is, there were fewer watermelons in a bin or carton than are normally packed in a standard size carton or bin. The underlying documentation for this portion of the claim is found in Petitioner's Exhibits 15, 17, 24, 25, 28, 29, 36, 38, 39, 41, and 43-46. For the following reasons, this claim is found to without merit. The custom and usage in the industry is for the grower to provide good and marketable quality watermelons at the size and state of maturity required by the buyers. Petitioner experienced harvesting problems, and his watermelons were too large, resulting in improper sizing, inaccurate counts in bins, and oversizing in cartons. This ultimately affected the number that could be packed into a carton or bin and resulted in many containers having fewer watermelons than are normally packed. Under these circumstances, the buyers made deductions for non-conforming watermelons. Petitioner argues that he should have been consulted by Bailey or Respondent and allowed to request a government inspection each time a buyer found a non-conforming load. The evidence shows, however, that this would have been impractical, time-consuming, and futile since an inspection would simply confirm that there was a short count in the bins. Moreover, given the time of the year (June 1996), inspections may well have caused additional spoilage since loads would remain unpacked in the truck in the hot weather until a government inspector became available. Then, too, the inspection process would tie up the facilities of the buyer until the process was completed. Weight differences Petitioner next contends that he is owed $5,064.23 for the difference in weight shown on the bills of lading and the weight the buyer received. In other words, on thirteen shipments, the delivered weight was less than the weight shown on the bill of lading. These shipments are documented in Petitioner's Exhibits 2, 4, 6, 8, 9, 11, 14, 16, 21, 22, 30, 32, and 40. The usual and customary practice in the industry is for the buyer to pay for the delivered weight of watermelons and not the shipped weight. In this case, most of the weight differences occurred with respect to bulk load shipments of watermelons. The evidence shows that it is not unusual for bulk load shipments to have weight differences of up to 2,000 pounds. For differences of more than 2,000 pounds, the standard practice is for the broker to contact the grower, advise that there is a problem, and ask if the grower desires a government inspection. The shipments identified in Petitioner's Exhibits 2, 6, 8, 11, 14, 22, 30 and 32 had weight differences of less than 2,000 pounds and therefore were not unusual. On the remaining five loads, however, Petitioner was not told that there was a problem, nor was he asked if he wanted a government inspection. This was contrary to industry practice. Accordingly, as to the shipments identified in Petitioner's Exhibits 4, 9, 16, 21, and 40, Petitioner should be compensated for the difference between the delivered weight and the bill of lading, or $4,420.53, less any commissions due Respondent. Log price differences Petitioner next contends that he is entitled to $7,489.55 for the price difference between the log book price and the price paid by the buyer. In other words, he is contending that he was guaranteed a certain sales price, but the produce was sold for a lesser amount. To determine the amount allegedly due, Petitioner multiplied the difference between his log book price per pound and what the buyer paid per pound times the weight received by the buyer. The standard practice in the industry is that a broker or dealer does not guarantee a price for the grower when the produce is being handled on a commission basis. The dealer is simply obligated to make a "best effort" to get the top price back to the farmer. This industry practice was incorporated into the Marketing Agreement, and Petitioner was aware of this industry standard. Although Petitioner may have been led to believe by Bailey that he would receive a specified amount per pound on some future loads, and Petitioner then recorded that amount in his log book, there was no way that such a price could be guaranteed until the produce was actually sold to the buyer. Accordingly, Petitioner is only entitled to be paid the amount for which the watermelons were sold. Therefore, this portion of his claim should be denied. Cooler loads Finally, Petitioner has claimed reimbursement in the amount of $7,513.74 for 47,798 pounds of watermelons shipped to a cooler in White Springs, Florida, for which he alleges he never received any compensation. The underlying documents for this claim are found in Petitioner's Exhibits 49 through 55. Because some watermelons were ripe in the field but still unsold, and Bailey did not want them to spoil, he shipped seven loads to a cooler in White Springs for storage for delivery on future sales. Bailey had leased the cooler for just this purpose. The total weight shipped from Petitioner's farm to the cooler was 271,464 pounds. The total weight sold from the cooler was 213,666 pounds, or a difference of 57,798 pounds. Through no fault of Bailey, however, some of the produce became spoiled and had to be dumped. According to Bailey, at least 40,000 pounds or more were dumped. However, the individual who was in charge of the cooler, William G. Poucher, estimated the amount to be no more than 10,000 pounds. Poucher's testimony is accepted as being more credible on this issue. This left approximately 47,798 pounds of unaccounted watermelons, for which Petitioner should be compensated. Petitioner apparently calculated his claim by multiplying the unaccounted weight (47,798) by an average price of around fifteen cents per pound to arrive at a figure of $7,513.74. This yardstick has not been challenged, and it is accordingly found that Petitioner is owed $7,513.74, less any commissions due Respondent. Respondent has contended that because the cooler movements were never disclosed to him by Bailey and Petitioner, he should not be held liable for any missing produce. However, the shipments were made at the direction of Respondent's agent and partner, Bailey, and thus he should be accountable for the actions of his agent/partner. Respondent also suggests that the 47,798 pounds of unaccounted watermelons were non-conforming produce unable to be sold. The more credible evidence suggests otherwise.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Department of Agriculture and Consumer Affairs enter a final order determining that Respondent owes Petitioner the moneys discussed in paragraph 44. In the event payment is not timely made, the surety should be responsible for the indebtedness. DONE AND ENTERED this 18th day of November, 1997, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 day 18th of November, 1997. COPIES FURNISHED: Honorable Bob Crawford Commissioner of Agriculture The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810 Brenda Hyatt, Chief Bureau of Licensing and Bond 508 Mayo Building Tallahassee, Florida 32399-0800 Felix M. Adams, Esquire 138 Bushnell Plaza, Suite 201 Bushnell, Florida 33516 Richard D. Sneed, Esquire 1905 South 25th Street Suite 206, Mardi Executive Center Fort Pierce, Florida 34947 Nick Cerulli, Esquire Bond Claim Department Reliance Insurance Company 4 Penn Center Plaza Philadelphia, Pennsylvania 19103 Richard D. Tritschler, Esquire Department of Agriculture and Consumer Services The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810
The Issue Whether the Respondent, Ronald Justice, is indebted to the complainants, James M. O'Dell, Jr., and Ronald Lewis, d/b/a O'Dell & Lewis Farms.
Findings Of Fact This cause is being considered pursuant to Chapter 604, Florida Statutes, which establishes procedure for settlement of controversies between Florida produce farmers and dealers involved with farmers' products. James M. O'Dell, Jr. and Ronald Lewis filed a complaint against Ronald Justice contending that the Respondent had not paid for two loads of watermelons as follows: May 27, 1977, invoice number 387664, 46,640 lbs Grey Watermelons at 4 cents per lb. totaling $1,865.60 May 29, 1977, invoice number 387670, 43,910 lbs Grey Watermelons at 4 cents per lb. totaling $1,756.40 The Petitioners contend, "Mr. Justice placed this order over the telephone, at which time the price had been agreed upon. He sent his own truck and his own driver to pick up these watermelons. The trucks were loaded according to his instructions while his own drivers were present and observed the loading. We had sold watermelons from this same field prior to these and the same day as well as after these dates and there had been no problem with quality. These watermelons were produced here by us at Oxford, Florida. We had expected payment within a few days after arrival, when he was expected to wire money to our bank. Thus far he has not sent this money which is for the above load while previous loads have been paid for." Respondent contends "As the Respondent in this case I wish to state again that I cannot ignore the first load of melons involved, (which I readily paid for sight unseen) as settled even though O'Dell and Lewis wish to ignore it as they had no grievance in the first load transaction. As my own personal affidavit states and as the affidavit of the driver John Braziel, supports; the first load was the greenest of the three loads which it naturally would be as it was clipped from the vine before the next two loads, also it was the inspection of the first load and the second load that made me feel justified that I had paid O'Dell and Lewis an appropriate sum of money until I was more certain how I could come out financially in the freight, sorting and handling of their melons, also please bear in mind that I suffered a business reputation damage that I am now willing to forego in an effort to settle this matter." The Petitioners sold the Respondent three loads of watermelons. Respondent's drivers loaded the watermelons on or near the farm of Petitioners. The first load was paid for and is not a part of the complaint of the Petitioners. The second and third loads ordered by the Respondent and filled by the Petitioners are the points of controversy. The watermelons were delivered to the Respondent in Mississippi where he had sold them to various stores. He stated that of the first load which he bought from the Petitioners that he could use but 50 percent inasmuch as the watermelons were unripe. He states that of the second load 30 percent of the watermelons were unripe and could not be used and that of the third load 25 percent of the watermelons were unripe and could not be used. He states that he was compelled to dump the part of the watermelons that could not be used and so dumped them. He contends that his loss on the first load was $1,640.34; that his loss on the second load was $356.80; and that his loss on the third load was $298.58 for a total loss on the three loads from the Petitioners of $2,295.72 actual money out of pocket. Mr. Justice states that he intended to cancel the third load inasmuch as a large percentage of the first two loads were unripe, but that it was his understanding by a telephone call to the Petitioner Ronald Lewis that Lewis had the intention of standing behind his loss and that therefore he did not cancel the order for the third load. The Petitioners claim that the watermelons were loaded into trucks sent there by the Respondent with his drivers, each of whom inspected the watermelons at the time of loading. They contend that no more than 1 percent of the watermelons loaded were unripe. They also contend that had the Respondent employed a certified inspector to inspect the watermelons at the point of delivery and the inspector had stated that the watermelons were unripe that they would have accepted the inspector's report, but that no inspection was made. Affidavits from the truck drivers who were not growers or inspectors were submitted. Each stated that a large percentage of the watermelons were not ripe.
Recommendation It is recommended that the Respondent be required to pay the Petitioners $3,622.00 for the watermelons purchased from the Petitioners. DONE AND ENTERED this 8th day of March, 1978, in Tallahassee, Florida. DELPHENE C. STRICKLAND Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Mr. Ronald Justice 500 South Main Street Dermott, Arkansas 71638 James A. O'Dell, Jr., and Ronald Lewis d/b/a O'Dell & Lewis Farms Post Office Box 268 Oxford, Florida
Findings Of Fact The Petitioner, Triple M Packing, Inc. (Triple M) is in the business of selling produce, particularly tomatoes from its principal business address of Post Office Box 1358, Quincy, Florida. The Respondent, Fair Chester Tomato Packers, Inc. (Fair Chester), is primarily engaged in the business of packaging, distributing and brokering tomatoes in the New York City metropolitan area. It purchases produce from various sellers around the country in tomato-producing areas for resale at markets in the New York City area. Since it is a licensed agricultural dealer, the Respondent is required under the pertinent provisions of Chapter 604, Florida Statutes, to file a surety bond with the Department of Agriculture and Consumer Services (Department), designed to guarantee payment of any indebtedness to persons selling agricultural products to the bonded dealer to whom the dealer fails to make accounting and payment. Fair Chester has thus obtained a 50,000 surety bond which is underwritten by its Co-Respondent, Hartford Accident and Indemnity Company (Hartford). During the 1984 growing season, the Petitioner sold certain shipments of tomatoes to the Respondent for a price of $12,276. Thereafter, curing middle-to-late 1984, the Respondent Fair Chester, found itself in straitened financial circumstances such that it was unable to pay its various trade creditors, including the Petitioner. In view of this, various creditors at the behest of a lawyer retained by Fair Chester, eventually entered into a composition agreement, whereby the unsecured trade creditors agreed to settle, release and discharge in full their claims against Fair Chester on the condition that each creditor signing that agreement be paid thirty-three and one-third percent of its claim. It was determined that the composition agreement would be operative if the trade creditors representing 95 percent or more in dollar amount of all unsecured debts accepted the terms and provisions of that composition agreement on or before November 13, 1984. All the Respondent's unsecured trade creditors were contacted and ultimately those representing more than 95 percent of the outstanding creditor claims against Respondent accepted the terms and provisions of the composition agreement by the deadline. A document indicating acceptance by the Petitioner was signed by one Robert Elliott, purportedly on behalf of the Petitioner, Triple M Packing, Inc. In this connection, by letter of November 13, 1984 (Respondent's Exhibit 4) Attorney Howard of the firm of Glass and Howard, representing the Respondent, wrote each trade creditor advising them that the required acceptance by 95 percent of the creditors had been achieved, including the acceptance of the agreement signed and stamped "received November 8, 1984" by Robert Elliott, sales manager of Triple M. In conjunction with its letter of November 13, 1984, Glass and Howard transmitted Fair Chester's check for one-third of the indebtedness due Triple M or $4,092. The Petitioner's principal officer, its president, Kent Manley, who testified at hearing, acknowledged that he received that letter and check, but he retained it without depositing it or otherwise negotiating it. In the meantime, on October 29, 1984 a complaint was executed and filed by Triple M Packing, Inc. by its president, Kent Manley, alleging that $12,276 worth of tomatoes had been sold to Respondent on June 13, 1984 and that payment had not been received. The purported acceptance of the composition agreement executed by Robert Elliott, sales manager, was not executed until November 8, 1984 and the check for $4,092 in partial payment of the Triple M claim was not posted until November 13, 1984. Mr. Manley's testimony was unrefuted and established that indeed Mr. Elliott was a commissioned salesman for Triple M, was not an officer or director of the company and had no authority to bind the company by his execution of the composition of creditors agreement. Mr. Manley acted in a manner consistent with Elliott's status as a commissioned salesman without authority to bind the Petitioner corporation since, upon his receipt of the "one- third settlement" check with its accompanying letter, he did not negotiate it, but rather pursued his complaint before the Department. In fact, in response to the Department's letter of December 20, 1984 inquiring why the complaint was being prosecuted in view of the purported settlement agreement, Mr. Manley on behalf of Triple M Packing, Inc. by letter of December 28, 1984, responded to Mr. Bissett, of the Department, that he continued to hold the check and was not accepting it as a final settlement. Thus, in view of the fact that the complaint was filed and served before notice that 95 percent of the creditors had entered into the composition agreement and never withdrawn, in view of the fact that on the face of the complaint Robert C. Elliott is represented as a salesman indeed, for an entity known as "Garguilo, Inc.," and in view of the fact that Mr. Manley as president of Triple M, retained the check without negotiating it and availing himself of its proceeds, rather indicating to the Department his wish to pursue the complaint without accepting the check as settlement, it has not been established that the Respondent, Fair Chester, was ever the recipient of any representation by Manley, or any other officer or director of the Petitioner corporation, that it would accept and enter into the above-referenced composition of creditors agreement. It was not proven that Triple M Packing, Inc. nor Mr. Manley or any other officer and director either signed or executed the composition agreement or authorized its execution by Robert C. Elliott. Respondent's position that Mr. Manley and Triple M acquiesced in the execution of the settlement agreement by Elliott and the payment of the one-third settlement amount by the subject check has not been established, especially in view of the fact that the complaint was filed after Attorney Howard notified Triple M of Respondent's settlement offer and prior to notice to Triple M that the settlement agreement had been consummated by 95 percent of the creditors and prior to the sending of the subject check to Triple M. Mr. Manley then within a reasonable time thereafter, on December 28, 1984, affirmed his earlier position that the entire indebtedness was due and that the settlement had not been accepted.
Recommendation Having considered the foregoing Findings of Fact and Conclusions of Law, the candor and demeanor of the witnesses, the evidence of record and the pleadings and arguments of the parties, it is, therefore RECOMMENDED: That Fair Chester Tomato Packers, Inc. pay Triple M Packing Company, Inc. $12,276. In the event that principal fails to or is unable to pay that indebtedness, Hartford Accident and Indemnity Company should pay that amount out of the surety bond posted with the Department of Agriculture and Consumer Services. DONE and ENTERED this 16th day of September, 1985 in Tallahassee, Florida. Hearings Hearings 1985. COPIES FURNISHED: Mr. Kent Manley, Jr. Post Office Box 1358 Quincy, Florida 32351 P. MICHAEL RUFF Hearing Officer Division of Administrative The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative this 16th day of September, Arthur Slavin, Esquire BLUM, HAIMOFF, GERSEN, LIPSON, GARLEY & NIEDERGANG 270 Madison Avenue New York, New York 10016 Honorable Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, Florida 32301 Mr. Joe W. Kight Bureau of Licensing & Bond Department of Agriculture Mayo Building Tallahassee, Florida 32301 =========================================================== ======
Findings Of Fact D. L. Wadsworth buys watermelons in the field and sells them to parties to whom the melons are delivered. In 1984 he agreed to buy melons from Charles Shackelford. In conducting his business Wadsworth is not an agent for the grower nor does he act as broker between the grower and the person who ultimately takes delivery of the melons. There was obviously a misunderstanding on the part of Petitioner as to the exact role played by Wadsworth in his buying of watermelons. Shackelford testified that Wadsworth agreed to handle his watermelon crop for the 1984 harvest. Wadsworth, on the other hand, does not buy fields but only "loads" on a daily basis. The harvesting of the watermelons is done by an agent of the grower, not by Respondent. Respondent buys the melons which he loads and ships out. On June 1, 1984, Respondent bought two loads of melons from Petitioner for which he paid four cents per pound. This is the same price Wadsworth paid to other growers from whom he purchased melons on June 1. On June 2, 1984, Respondent bought three loads of watermelons from Petitioner. Petitioner testified that he asked Respondent on June 2 what melons were bringing and was told four cents per pound. Wadsworth denies quoting a price to Shackelford but acknowledges that even if melons were bringing four cents a pound in New York he could not pay four cents per pound in Wauchula and ship them to New York without losing money on every watermelon he bought. Petitioner also testified that Respondent ceased handling his melons after June 2, 1984, that Respondent told him he was sick and was going back to Brandon and that he (Respondent) was not going to handle any more watermelons. Respondent denied that he was sick during this period or that he could not be contacted. Respondent paid his motel bill in Wauchula on June 9, 1984. On June 5, 1984, Respondent gave Petitioner his check for the watermelons he had purchased and an invoice (Exhibit 1) which showed the price for one load on June 1 at four cents per pound and three loads on June 2 at three and a half cents per pound. Respondent did not receive any complaint from Petitioner until the Complaint that is the basis of this hearing was filed. To support his testimony that he paid all growers the same price for watermelons purchased, Respondent submitted a list of those growers from whom he bought watermelons on May 31 through June 3 showing that he paid four cents per pound on the first two days of that period and three and a half cents per pound the last two days (Exhibit 2).
The Issue The issues presented here concern the attempt by Petitioner to recover $2,367.30 as payment for watermelons sold to Sunshine Fruit Company, Inc. See Sections 604.15 - 604.30, Florida Statutes.
Findings Of Fact In July, 1993, Petitioner was a producer of agricultural products in Florida. That product was watermelons. At that time Sunshine Fruit Company was a dealer in agricultural products grown in Florida. Bill Hamilton also produced watermelons in Florida in July, 1993. His field had a common boundary with Petitioner's field. The watermelons taken from Petitioner's field in July, 1993 adjacent to the Hamilton field are at issue here. Bill Hamilton had done business with Sunshine Fruit Company in 1993 but was unable to meet the July demand which Sunshine Fruit Company had for watermelons. Hamilton had conducted his business with Allen Reiter as representative for Sunshine Fruit Company. To assist Reiter in obtaining additional watermelons in July that Hamilton could not supply, Hamilton referred Reiter to the Petitioner. An agreement was made to sell Petitioner's watermelons. The agreement was one in which Phillip Allen, Petitioner's son, served as her representative in the negotiations. In this arrangement the son was entitled to fifty percent of any profits and Petitioner the remaining 50 percent. The deal Petitioner made was to provide one load of medium melons and one load of large melons to Sunshine Fruit Company. Allen Reiter sent trucks to pick up the melons from Petitioner's field. After referring the Petitioner's business to Sunshine Fruit Company, Bill Hamilton observed Allen Reiter cut watermelons that were being delivered to Sunshine Fruit Company to examine the condition of the watermelons. Those watermelons that were being examined were located on a field truck. The field truck was a truck different from the truck that was to be used in transporting the watermelons to market. Hamilton also observed Reiter examining watermelons that were being loaded onto the transport truck. Hamilton had not experienced significant problems with hollow heart or bruising in the watermelons that he had harvested in the field adjacent to that belonging to the Petitioner in the year 1993. An approach which Hamilton and Petitioner had employed to avoid crop damage to the watermelons was to avoid loading watermelons that had become wet when it rained. Both producers, that is to say Hamilton and the Petitioner, had experienced an occasional slow down in harvesting in July, 1993, because of rain. Rain delayed the harvesting and loading of the Petitioner's watermelons provided to Sunshine Fruit Company. When the rain shut down the harvesting operation, some of the watermelons had already been picked. Harvested watermelons were put on the field truck before the rain commenced and were covered up with plastic to keep the rain from damaging the watermelons. The watermelons that had been picked that morning and placed on the field truck were left on the field truck while it rained hard that afternoon. The load that is being described was finished with watermelons picked the following day. Charles Gardner who worked for Petitioner in the harvesting operation also saw Allen Reiter cut watermelons that were on the field truck on the first day, the day it rained in the afternoon. Gardner also saw Reiter examine melons on the field truck on the second day. Phillip Allen and others loaded the two trucks provided by Sunshine Fruit Company and he supervised that operation. The second load of watermelons was placed on a truck that Phillip Allen and Charles Gardner understood to be Allen Reiter's "personal truck." An individual whose name was not identified at the hearing, whom Gardner and Phillip Allen understood to be "Reiter's personal driver", based upon an introduction made by Allen Reiter, interfered with the attempts by Phillip Allen to discard watermelons of questionable quality that were being loaded onto the transport truck. Phillip Allen told the driver that the questionable watermelons were bad, and the driver said "they are all right". When Phillip Allen would attempt to discard watermelons, this unidentified individual would return the questionable watermelons into the group of watermelons being transported, accompanied by a remark to the effect, "don't worry about it." This arrangement was contrary to the more typical arrangement in which the producer would discard what it referred to as the "culls." This caused a considerable number of watermelons to be kept for transport that should have been discarded. In the past the "culls" had been broken in the field or sold as pig feed. Phillip Allen tried to contact Allen Reiter by telephone after experiencing problems in which the driver insisted that substandard watermelons be packed. Phillip Allen was unable to reach Allen Reiter. Being unsuccessful in this attempt at contact, Phillip Allen deferred to the driver's choice to leave bad watermelons in the load for transport to market. However, Phillip Allen, not the driver, was in charge of the loading of the truck upon which substandard watermelons were being placed. Therefore, to the extent that the substandard watermelons diminished the value of the load, Petitioner must suffer the consequences. Nothing in the record leads to the conclusion that the driver had the authority to act as agent for Sunshine Fruit Company in determining what watermelons were of sufficient quality to be shipped. The driver mentioned in the previous paragraph stated in the presence of Charles Gardner that he was going home for the weekend and would deliver the watermelons on Monday. This comment was made on the prior Friday. The driver stated in the presence of Phillip Allen that he was going home because of brake problems and was going to wait to deliver the melons until Monday. Larry Thompson was the buyer and field supervisor for Sunshine Fruit Company in the transaction with Petitioner. Because it had been raining for several days, the decision to purchase the watermelons was through an arrangement in which the price would be determined at the time of receipt at the ultimate destination for the produce. There was no written agreement between the parties. Larry Thompson went to the field on the day after it had rained. While at the field on the second day Thompson observed the load of large watermelons. Charles Gardner told Larry Thompson that the large watermelons were popping. Larry Thompson told Allen Reiter that Reiter needed to check the large watermelons. Larry Thompson observed watermelons that were split. The watermelons were further observed by cutting the melons to examine them. During these events Thompson told Reiter that Thompson was glad that Sunshine Fruit Company was "riding" the watermelons, meaning waiting to determine the price until delivery at the ultimate destination. Otherwise Sunshine Fruit Company would not have bought the watermelons that were in the questionable condition as Thompson observed them on the second day. Some of these substandard watermelons were observed by Phillip Allen when loading the trailer and in conversation with the unnamed driver. As expected, this load of watermelons was in poor condition at the place and time that it was delivered. This was confirmed by an inspection that was performed at the place of ultimate delivery. Phillip Allen was made aware of the problem with that load. Phillip Allen told Larry Thompson that he, Phillip Allen, was going to have to contact the Inspector and asked that Thompson provide Allen with a copy of the inspection report. Thompson mailed Allen a copy of the inspection report. Thompson told Allen that some arrangement would have to be made to gain the best financial outcome with the questionable load of watermelons that could be achieved or that the watermelons would have to be dumped. It was resolved between Thompson and Allen that an individual in Pittsburgh, Pennsylvania, would be responsible for making some disposition with the questionable load of watermelons and this was accomplished by that individual in Pittsburgh, Pennsylvania. It is unclear who would pay for freight. Concerning the freight costs, Petitioner made no claim at hearing that the freight costs should be borne by Sunshine Fruit Company, and Petitioner and Sunshine Fruit Company failed to prove the amount of freight costs that had been incurred. However, based upon testimony by Dale Swain, a dealer in agricultural products in the region, it is inferred that the custom and practice employed in selling watermelons in 1993, to include watermelons sold by Petitioner to Sunshine Fruit Company, called for the deduction of freight expenses from the price paid for the watermelons. Watermelons Swain purchased from Petitioner in July 1993 were of acceptable quality. It was established that the cost of harvesting the subject watermelons would be borne by the producer, Pauline Allen. Phillip Allen established that the price per pound for both medium and large watermelons was 3.5 . It is undisputed that the load amounting to 41,180 pounds at 3.5 per pound was worth $1,441.30. Nor is there any contention concerning the fact that Sunshine Fruit Company has paid $740 to the Petitioner for the watermelons in question. At hearing, Petitioner asserted that the second load, the load with problems, weighed at the scales in Florida before the transport in the amount 47,600 pounds. At 3.5 per pound the claimed value was $1,666.00. The at-scale value was not the agreed upon arrangement. The actual amount which was paid for the problem second load as delivered was not established at the hearing, but it can be inferred that the amount is less than $1,666.00 based upon facts that were presented at hearing.
Recommendation Based upon the findings of fact and the conclusions of law, it is, RECOMMENDED: That the Final Order be entered which dismisses the complaint calling for the payment of additional monies in the amount of $2,367.30. DONE and ENTERED this 18th day of March, 1994, in Tallahassee, Florida. CHARLES C. ADAMS, 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 18th day of March, 1994. APPENDIX CASE NO. 93-6173A The following discussion is given concerning the Respondent Sunshine Fruit Company's findings of fact: Unnumbered Paragraph 1 is subordinate to facts found with the exception that it is not clear in the record whether both loads are to be paid for within two weeks of passing inspection. Unnumbered Paragraphs 2 and 3 are not supported by the record. Unnumbered Paragraph 4 constitutes legal argument. COPIES FURNISHED: Phillip Allen 695 North Maylen Lacanto, FL 34461 Allen Reiter 3535 Recker Highway Winter Haven, FL 33880 Richard E. Straughn, Esquire Post Office Box 2295 Winter Haven, FL 33883-2295 Meritor Savings, F.A. Post Office Box 193 Winter Haven, FL 33882 Brenda Hyatt, Chief Department of Agriculture Bureau of Licensure and Bond 508 Mayo Building Tallahassee, FL 32399-0800 Bob Crawford, Commissioner Department of Agriculture The Capitol, Plaza Level Tallahassee, FL 32399-0810
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing and at the subsequent deposition, the following facts are found: At all times pertinent to this proceeding, Petitioners were producers of agricultural products in the State of Florida as defined in Section 604.15(5), Florida Statutes (1983). At all times pertinent to this proceeding, Respondent Sales was a licensed dealer in agricultural products as defined by Section 604.15(1), Florida Statutes (1983), issued license No. 207 by the Department and bonded by Hartford Insurance Company of the Southeast (Hartford) in the sum of $20,000 - Bond No. RN 4429948. At all times pertinent to this proceeding, Respondent Hartford was authorized to do business in the State of Florida. The complaint filed by Petitioner was timely filed in accordance with Section 604.21(1), Florida Statutes (1983). On June 11, 1985 Respondent Sales, through its agent William C. Summers (Summers), contracted with Petitioners to load several loads of watermelons on trucks furnished by Respondent Sales at Petitioners' watermelon field. Petitioner agreed with Summers to load a good quality watermelon ranging in weight from seventeen (17) pounds and up, with an occasional watermelon weighing less than seventeen (17) pounds. The price agreed upon was $0.03 per pound with the sale being final upon loading, weighing and acceptance by Summers. Before loading any watermelons, Summers along with Petitioners Shivers inspected the field of watermelons for size and quality and to estimate how many watermelons were available for shipment. On June 11, 1985 Petitioners began loading the first load of watermelons the only load in dispute, in accordance with the agreement. Summers was present on several occasions, for periods of approximately thirty (30) minutes each time, during the time of loading and on occasions would instruct Petitioner Sullivan who was packing, to put watermelons, both large and small which Sullivan had rejected, back on the truck for shipment. Petitioner finished loading the first load of watermelons on June 11, 1985 which was weighed and accepted and paid for by Summers on June 12, 1985. The net weight was 43,260 pounds for a total amount of $1,297.80. On June 12, 1985, Summers issued a check jointly to Petitioners on Respondent Sales' checking account which Summers signed for the sum of $1,297.80 but later "stopped for payment" on this check and Respondent Sales has since refused to pay Petitioners this amount. Although Sullivan advised Summers that a range in weight of 17 pounds and up was too wide for a load of watermelons to be classified as medium, Summers advised Sullivan to load watermelons weighing 17 pounds and up. After Petitioners started loading the second load, Summers instructed Sullivan to only pack watermelons ranging in weight from 17 to 24 pounds which Sullivan did and Petitioners were paid for this second load without incident. The evidence was insufficient to prove that the watermelons in question had been rejected at destination due to the wide range of weights or for any other reason. 13, The evidence is clear that Summers was acting for Respondent Sales and had authority to purchase and accept the watermelons in dispute. The only reason Respondent Sales' refused to pay was the alleged nonconformance as to size.
Recommendation Based upon the Findings of Fact and Conclusions of Law recited herein, it is RECOMMENDED that Respondent Sales be ordered to pay to the Petitioners the sum of $1,297.80. It is further RECOMMENDED that if Respondent Sales fails to timely pay the Petitioner as ordered, then Respondent Hartford be ordered to pay the Department as required by Section 604.21, Florida Statutes (1983) and that the Department reimburse the Petitioner in accordance with Section 604.21, Florida Statutes (1983). Respectfully submitted and entered this 13th day of March, 1986, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE 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 13th day of March 1986. COPIES FURNISHED: Doyle Conner, Commissioner Department of Agriculture and Consumer Services The Capitol Tallahassee, Florida 32301 Robert Chastain, General Counsel Department of Agriculture and Consumer Services Mayo Building, Room 513 Tallahassee, Florida 32301 Ron Weaver, Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32301 Joe W. Kight, Chief License and Bond Mayo Building Tallahassee, Florida 32301 Terry McDavid, Esquire 200 North Marion Street Lake City, Florida 32055 Steve Shiver and Jody Sullivan Route 1, 8ox 474 Mayo, Florida 32066 A. J. Sales Company Post Office Box 7798 Orlando, Florida 32854 Hartford Insurance Company of the Southeast 200 East Robinson Street Orlando, Florida 32801
The Issue The issue for determination is whether Respondents owe Petitioner approximately $3,807.00 for a quantity of watermelons provided to Respondents by Petitioner; secondarily, resolution of this issue requires a determination of whether Respondents acted as an agent for Petitioner as opposed to a direct purchase of Petitioner's melons by Respondents.
Findings Of Fact Petitioner is a resident of Suwannee County, Florida and a farmer who produces agricultural products, including watermelons. Respondent John W. Hill, is a dealer of such products in the course of normal business activity. Respondent Hill's services include arranging for the harvesting and loading of melons for shipment to northern markets, as well as the location of buyers for the melons. Respondent Hill acts as a broker in these arrangements, receives the gross sales receipts from buyers and from that sum deducts costs of labor, freight, inspections, any other associated costs and his commission. The net balance of the gross sales receipts are paid to the melon producers. Respondent Florida Farm Bureau Mutual Insurance Company is the bonding agent for Respondent pursuant to Section 604.20, Florida Statutes. Petitioner knew Respondent Hill and had discussed brokerage or trading of watermelons with him on occasion. Shortly before or on July 2, 1992, Petitioner's watermelon crew left him and he telephoned Respondent Hill. Unable to speak with Hill, Petitioner spoke with Hill's wife. She and Petitioner discussed a possible price for Petitioner's melons of five cents a pound. Shortly thereafter, Respondent Hill later contacted Petitioner by telephone and confirmed the five cents per pound price, provided the melons met requirements. Respondent was using a cellular telephone in his truck and when Petitioner hung up his telephone and walked out of his barn, he observed Respondent's employees in the field starting to cut the vines connected to the melons. Respondent Hill was nearby in his truck. Petitioner and Respondent Hill drove around the farm and looked at Petitioner's various melon plots. Respondent Hill agreed to attempt to market a variety of the melons known as sangaria at the five cents per pound price. The parties did not reduce their agreement to writing. Respondent Hill felt that Petitioner understood that they were partners, that he was acting as Petitioner's broker for the eventual sale of the melons to a specified buyer, FRESH PLUS, a buyer in Philadelphia, Pennsylvania. At one point during the process of driving around the watermelon field, Hill and Petitioner discussed the condition of the melons and that they would run the melons in and see if they could get five cents per pound for them. Hill also was convinced that Petitioner understood that the melons must be accepted by the receiver or meet certain conditions in order to get that price for the melons. It is customary within the industry that, unless stated otherwise, all melons must grade US #1 at the time of delivery to a buyer. Petitioner did not accompany the loads of watermelons to the shipping facility where the sangaria melons were weighed and loaded for shipment. As a result, he did not receive a copy of Respondent Hill's July 2, 1992, track report documenting a 48,320 pound load of sangaria watermelons bearing the written statement "must be accepted by receiving or grade U.S. #1." The melons were rejected by the buyer upon arrival in Philadelphia as not meeting requirements and Respondent Hill, when learning of the rejection, called for and received an official USDA inspection of the melons. The July 6, 1992 inspection revealed that the melons were not US #1. Respondent Hill then shipped the melons to an alternate perspective buyer, T & K Binning in Jessup, Maryland. Upon arrival, T & K rejected 375 of the melons and accepted 2,127 melons at $1.25 per melon for a total purchase price of $2,685.75 which was received by Respondent Hill. After subtraction of labor costs of $733.12, freight costs of $1,965.00, and inspection costs of $133.50, Respondent Hill absorbed a net loss of $212.93. Another 27,280 pounds of melons that were not of the sangaria variety were loaded from Petitioner's farm and shipped to a seller, Park-N-Shop, in Charlotte, North Carolina, along with melons grown by several other producers. These commingled melons were sold for a gross sales price of $1,344.00. After substraction of labor costs of $792.83 and freight costs of $714.20, Hill absorbed a net loss of $163.03 for the melons. Testimony of Respondent Hill at the final hearing was corroborated by documentation of Respondent Hill's absorption of all costs connected with the sale of the melons, including initial loading costs. Hill's testimony establishes that the arrangement between the parties was a brokerage arrangement and that the sale of the melons was subject to conditions common to the industry, i.e., that the melons grade #1 upon receipt by buyer. Testimony of Petitioner is uncorroborated and fails to establish that the agreement between the parties contemplated a direct sale of the melons to Respondent Hill.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered dismissing Petitioner's complaint. DONE AND ENTERED this 15th day of July, 1993, in Tallahassee, Leon County, Florida. DON W. DAVIS 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 15th day of July, 1993. APPENDIX The following constitutes my rulings, pursuant to requirements of Section 120.59, Florida Statutes, on proposed findings of fact submitted by the parties. Petitioner's Proposed Findings 1. Accepted in substance. 2.-3. Rejected, subordinate to HO findings on this point. 4. Rejected, argument. Respondent's Proposed Findings 1.-9. Accepted in substance. 10. Rejected, cumulative. COPIES FURNISHED: David Hingson Route 4, Box 330 Live Oak, Florida 32060 William A. Slaughter, II, Esquire P.O. Box 906 Live Oak, Florida 32060 Florida Farm Bureau Mutual Insurance Company Legal Department 5700 SW 34th Street Gainesville, Florida 32608 Hon. Bob Crawford Commissioner of Agriculture The Capitol Tallahassee, Florida 32399-1550 Richard Tritschler General Counsel 513 Mayo Building Tallahassee, Florida 32399-0800 Brenda Hyatt, Chief Bureau of Licensing & Bond Department of Agriculture Mayo Building, Rm 508 Tallahassee, Florida 32399-0800
The Issue The issues that were considered in the course of the hearing were those related to a claim by the Petitioner of entitlement to receive an additional $5,581.00 in proceeds related to the sale of watermelons to J. R. Sales, Inc. In this case Petitioner has alleged that the Respondent J. R. Sales, Inc. in the person of its representative, one Carr Hussey, had agreed to pay a fixed price of four cents per pound for large grey watermelons and 3.5 cents per pound for medium grey watermelons and that four cents per pound was due the Petitioner for the delivery of large jubilee watermelons. It is further alleged that those prices were not paid. If the Petitioner's assertions are correct, the additional amount owed would be $5,581.00. In reply Respondent J. R. Sales, Inc. denies the claim of $5,581.00 and in its defense states that all money due and owning to the Petitioner has been paid.
Findings Of Fact Petitioner, Earl Dicks, is a farmer in Columbia County, Florida. In 1984 Petitioner grew two varieties of watermelons in Columbia County for the purpose of selling those crops commercially. Those watermelon varieties were greys and jubilees. As of June 21, 1984, Petitioner had not sold his crop of watermelons. On that date Petitioner was introduced to Carr Hussey, President of J. R. Sales, Inc. This introduction was made by another farmer, one Doyle Ottinger. The purpose of this introduction was to ascertain whether Hussey would be interested in purchasing the watermelons which Petitioner had available for sale. J. R. Sales, Inc. is a company which purchases watermelons in Florida for delivery and further sale in markets outside of Florida. Following the introduction of the Petitioner and Hussey, those two gentlemen, Ottinger and Petitioner's son, Edward Dicks, went to see Petitioner's grey watermelon crop in Columbia County. Prior to arriving at the field, no discussion had been entered into between the Petitioner and Hussey as to price. While at the field Petitioner offered to sell the entire field of watermelons, and Hussey declined the purchase. At that juncture Hussey was not aware of any particular market in which he might place the Petitioner's watermelons. Hussey did indicate that if he were able to find a market for those crops, he would pay Petitioner the fair market value per pound for those watermelons on a given day. He further stated that the fair market price on June 21, 1984, was four cents a pound for large and 3.5 cents a pound for medium greys. The market price considerations at work, as Hussey envisioned them, had to do with the market conditions in New York, New England and Canada, places where the watermelons would be delivered. It also was important that the watermelons be delivered prior to July 4, 1984. The importance of this date had to do with the demand for watermelons for retail purchase prior to July 4, 1984, and a softening market immediately subsequent to that date. The discussion as to price was made in the presence of Petitioner, his son, and Hussey. There was no other discussion concerning the purchase price of the grey variety of watermelon, and no written document evidences this oral discussion of price. Following the conversation of June 21, 1984, in which price was discussed between the Petitioner and Hussey, the grey watermelons which Petitioner had in Columbia County were available for harvesting. One or two days after this conversation, the first loads of watermelons were harvested. Although Petitioner believes that 17,000 pounds of medium watermelons were harvested with the balance of the watermelons taken on that day being large watermelons, it is found that the 17,000 pounds related to large watermelons with the balance being medium watermelons. This pertains to Petitioner's Exhibit Number 1 admitted into evidence which contains the composite invoices for those loads together with poundage and price. Seventeen thousand pounds relates to the large at 3.5 per pound with the balance of the weights pertaining to mediums at three cents per pound. The net amount paid after deducting the cost of harvesting was $3,085.78. On July 2, 1984, additional medium and large grey watermelons were harvested from the Petitioner's Columbia County fields, through J. R. Sales, Inc. A copy of the composite invoices related to the latter, together with a description of the sizes, weights, and prices paid with deduction of harvesting cost, may be found in Petitioner's Exhibit Number 3 admitted into evidence. Price paid was 2.5 cents per pound for medium greys and three cents per pound for large greys. These watermelons were watermelons which would not have arrived at J. R. Sales' markets in time meet the July 4, 1984, peak sales period. The total amount paid for this July 2, 1984, harvest of greys was $5,104.75. 6..Watermelons purchased from the Petitioner had to be placed in markets other than those normally served by J. R. Sales, Inc. In the period June 23 through June 25, 1984, J. R. Sales, Inc. bought watermelons from other farmers in the growing area and paid prices for large greys which varied from three cents to 3.5 cents per pound. The price being paid for medium greys in that time frame was three cents per pound, to a farmer other than Petitioner. In the same sequence of days, 3.5 cents per pound was paid for a purchase of large jubilees from another farmer. On the subject of large jubilees, Hussey had been shown a field of jubilee watermelons that were grown by Petitioner in Columbia County. When shown the melons, he indicated that he was not interested in purchasing them. Nonetheless, J. R. Sales, Inc. harvested large jubilee watermelons from that field and paid $1,529.15 for them. Payment was made to Petitioner at a rate of three cents per pound less harvesting cost. Petitioner's son was aware of this harvesting of the large jubilees. The composite invoices related to the large jubilees may be found in Petitioner's Exhibit Number 2 admitted into evidence, a copy. This document shows the invoice numbers, the size, the price per pound and weight together with the gross price less harvesting cost and the net payment price. These watermelons were harvested on June 28, 1984. Even though there was no discussion as to price of the jubilees, Petitioner was of the opinion that four cents a pound for large jubilees should be the price, a price never agreed to by J. R. Sales, Inc. Sherod Keen, another individual who brokered and purchased watermelons in the area of Columbia County, Florida, in 1984 gave testimony. His testimony established that in the period June 21 through June 28, 1984, he was paying farmers a price between 3.5 cents to four cents per pound for medium greys and four to 4.5 cents per pound for large greys. On July 2, 1984, Keen was paying 3.5 to four cents for large greys. Keen agreed with Petitioner and Hussey that the cutoff date prior to July 4, 1984, is critical in terms of the price to be paid, in that watermelons delivered to the market prior to July 4, 1984, would bring a better price than those prices immediately following July 4, 1984. Keen sells in places such as Florida, Maine and Wisconsin. Keen was not interested in purchasing the watermelons which Petitioner sold to J. R. Sales, Inc. Hussey, Keen and Ottinger established through their testimony that the prices for watermelons varied day to day within the relevant time frame, June and July, 1984.
The Issue Whether Respondent owes Petitioner $2,377.20 as alleged in the complaint filed by Petitioner in July 1997.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Petitioner, Bigham Hide Company, Inc. (Petitioner), is a watermelon grower in Coleman and Lake Panasoffkee, Florida. Respondent, Florida-Georgia Produce, Inc. (Respondent), is a licensed dealer in agricultural products having been issued License Number 7666 by the Department of Agriculture and Consumer Services (Department). Respondent has posted a bond in the amount of $30,000.00 written by Cumberland Casualty & Surety Company, as surety, to assure proper accounting and payment to producers such as Petitioner. In a complaint filed with the Department in July 1997, Petitioner alleged that he entered into an agreement with Bobby Patton (Patton) on behalf of Respondent to sell one truckload of "pee wee" watermelons. Under that agreement, Respondent agreed to pay seven cents per pound for the watermelons, and it would advance Petitioner $700.00 to cover the labor costs associated with loading the truck. The remainder would be paid upon final delivery. The complaint goes on to allege that Petitioner subsequently learned that there was "some problem" with the delivered produce. After Respondent inspected Petitioner's field to verify the quality of the crop, Petitioner was told that Respondent would "fight the fight" to get the shipment accepted. Since that time, however, the complaint alleges that Petitioner did not receive payment, an accounting of the transaction, an inspection report, or any further explanation. Accordingly, Petitioner filed this complaint seeking $3,077.20, less the $700.00 advance, or a total of $2,377.20. In its answer, Respondent has alleged that it actually received a truckload of "old diseased watermelons that had been lying in the field or on [the] field truck for a week," and the receiver refused to accept the load. Since it received nothing for the shipment, Respondent contends it is owed $700.00 for the money advanced to Petitioner. The parties agree that in late May 1997, Petitioner was contacted by Bobby Patton, who was representing Respondent, regarding the sale of small size watermelons. Patton offered to buy one truckload of "pee wee" watermelons at a price of seven cents per pound, to be paid after delivery to the receiver. Patton also agreed to advance Petitioner $700.00 to cover his loading costs. Petitioner agreed to these terms, and the truck was loaded from his field on June 3, 1997. The net weight of the loaded produce was 43,960 pounds. The vehicle's tag number was recorded on the loading slip as "AH 39099" from the province of Quebec, Canada. There is no evidence that the crop was diseased when it was loaded, or that it had been picked and lying in the field for several days before being loaded, as suggested in Respondent's answer to the complaint. The shipment was destined for Ontario, Canada. On or about June 5, 1997, the product was delivered to the customer, Direct Produce, Inc., in Etobicoke, Ontario. Because of a perceived lack of quality, the buyer refused to accept the load. Respondent immediately requested a government inspection which was performed on June 6, 1997. The results of that inspection are found in Respondent's Exhibit 3. It reveals that 1 percent of the load was decayed, 3 percent were bruised, 6 percent had Anthrocnose (belly rot), and 75 percent had "yellow internal discolouration." In addition, a composite sample reflected that 20 percent had "Whitish Stracked Flesh" while 5 percent had "Hollow Heart." In other words, virtually the entire shipment was tainted with defects or disease. The report also reflected that the net weight of the shipment was 44,500 pounds, and the tag number of the vehicle was "ALP 390999." The weight and tag number were slightly different from those recorded on the loading slip at Petitioner's field. After learning of the results of the inspection, Respondent's president, James B. Oglesby, immediately contacted Petitioner's president, Greg Bigham, and requested an inspection of Bigham's field to verify the quality of watermelons. During the inspection, Oglesby did not find any signs of belly rot or other problems similar to those noted in the government inspection. If there had been any incidence of belly rot in Petitioner's field, it would have been present in other unpicked watermelons. At the end of his inspection, Oglesby told Petitioner that he would "fight the fight" to get the shipment delivered and sold. Oglesby eventually found a buyer who would accept the shipment as feed for cattle. The buyer agreed to pay the freight charges for hauling the watermelons to Canada but nothing more. Therefore, Respondent was not paid for the load. Petitioner was led to believe that he would receive payment and paperwork, including the inspection report, within a few days. When he did not receive any documentation, payment, or further explanation within a reasonable period of time, he filed this complaint. It would be highly unlikely that a farmer would have one completely bad load from a field without the same problems being present in other loads shipped from the field at the same time. Petitioner presented uncontroverted testimony that no other shipments from that field during the same time period were rejected or had similar problems. In addition, it was established that poor ventilation on the truck, or leaving the loaded truck unprotected in the sun, could be causes of the crop being spoiled or damaged before it was delivered to Canada. Finally, at hearing, Respondent suggested that Bigham may have shown him a different field than the one from which his load was picked. However, this assertion has been rejected.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Department of Agriculture and Consumer Affairs enter a final order determining that Respondent owes Petitioner $2,377.20. In the event payment is not timely made, the surety should be responsible for the indebtedness. DONE AND ENTERED this 6th day of February, 1998, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 Filed with the Clerk of the Division of Administrative Hearings this day 6th of February, 1998. COPIES FURNISHED: Honorable Bob Crawford Commissioner of Agriculture The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810 Brenda Hyatt, Chief Bureau of Licensing and Bond 508 Mayo Building Tallahassee, Florida 32399-0800 Terry T. Neal, Esquire Post Office Box 490327 Leesburge, Florida 34749-0327 James B. Oglesby Post Office Box 6214 Lakeland, Florida 33807 Cumberland Casualty & Surety Company 4311 West Waters Avenue Tampa, Florida 33614 Richard D. Tritschler, Esquire Department of Agriculture and Consumer Services The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearings the following facts are found: At all times pertinent to this proceeding, Petitioner was a producer of agricultural products in the State of Florida as defined in Section 604.15(5), Florida Statutes (1983). At all times pertinent to this proceedings Respondent Pagano was a licensed dealer in agricultural products as defined by Section 604.15(1); Florida Statutes (1983), issued license no. 1624 by the Departments and bonded by Sentry Indemnity Company (Sentry) in the sum of $29,000.00 - Bond No. 88-04453-01. At all times pertinent to this proceeding, Respondent Sentry was authorized to do business in the State of Florida. The complaint filed by Petitioner was timely filed in accordance with Section 604.21(1), Florida Statutes (1983). Petitioner sold several loads of watermelons to Respondent Pagano during the 1985 watermelon season but only three (3) loads are in disputed and they are: (a) 1 load of Crimson Sweet Watermelons loaded from Barron Farm No. 3 on April 19, 1985, weighing 46,180 pounds and billed on Petitioner's invoice, No. 24-2264 at $0.274 per pound for a total invoice price of $12,653.32; (b) 1 load of Crimson Sweet Watermelons loaded from Barron Farm No. 3 on April 19, 1985, weighing 44,920 pounds and billed on Petitioner's invoice, No. 24-2265 at $0.274 per pound for a total invoice price of $12,308.08; and (c) 1 load of Grey Watermelons loaded from Barron Farms No. 2 on April 20, 1985, weighing 41,620 pounds and billed on Petitioner's invoice No. 24-2298 at $0.274 per pound for a total invoice price of $11,403.88. Each truck was weighed before and after loading on the date loaded to determine the net weight of watermelons. There was no evidence presented that this net weight was incorrect. Although the price included the cost of delivery to Respondent Pagano at 62 Brooklyn Terminal Market, Brooklyn, New York, the more credible evidence shows that the agreement between Petitioner and Respondent Pagano was that title and risk of loss passed to Respondent Pagano on shipments with all remedies and rights for Petitioner's breach reserved to Respondent Pagano. When each of the three (3) loads arrived at their destinations the total pounds to be paid for, either at the agreed upon price or at a reduced price; was adjusted downward. On each of the loads there were some watermelons paid for at a reduced price because of alleged bruising which together with the reduction in total pounds and a deduction for "protect advance", caused a reduction in the total invoice price as follows: INVOICE NO. ORIGINAL PRICE ADJUSTED PRICE DIFFERENCE 24-2264 $12,653.32 $11,397.39 $1,255.93 24-2265 12,308.08 8,667.84 3,640.24 24-2298 11,403.88 10,478.50 925.38 TOTAL: 36,365.28 30,543.73 5,821.55 There was no federal or state inspection performed at the time the watermelons were loaded or after arrival at their destination. The more credible evidence shows that petitioner was not advised of the condition of the watermelons before the adjustment was made to allow petitioner an opportunity to ask for an inspection or give any other instruction with regards to the watermelons. Petitioner sold and shipped to different buyers, five (5) loads of Crimson Sweet Watermelons and two (2) loads of mixed watermelons from Barron Farms Nos. 2 and 3 on April 19, 1985 which were received without any incident of loss due to bruising or otherwise. Petitioner sold and shipped to different buyers five (5) loads of Grey watermelons from Barron Farm No. 2 and three (3) loads of Crimson Sweet Watermelons from Barron Farms Nos. 2 and 3 on April 20, 1985 which were received without any incident of loss due to bruising or otherwise. Petitioner made adjustments in the amount of freight owed on all three (3) loads due to differences in weight at point of shipment and weight at destination and for the weight of watermelons rejected. On invoice No. 24- 2265 the freight was reduced from $1,976.48 to $1,651.20 which included a reduction for 5,120 pounds of rejected watermelons at $4.40 per hundred weight plus $100.00 protect advanced on invoice No. 24-2298 the freight was reduced from $1,831.28 to $1,704.00 which includes a reduction for 620 pounds of watermelons due to difference in weight at point of shipping and weight at destinations plus $100.00 protect advanced and on invoice No. 24-2264 the freight was reduced from $2,031.92 to $1,847.88 which includes a reduction for 1910 pounds of watermelons rejected or difference in shipping and receiving weights plus $100.00 protect advance. The total difference in freight on all three loads is $636.60. On May 12 and 29, 1985, Respondent Pagano paid Petitioner the total sum of $30,543.73 leaving a balance owed on the three (3) loads of $5;82l.55 which Respondent Pagano has refused to pay.
Recommendation Based upon the Findings of Fact and Conclusions of Law recited herein, it is RECOMMENDED that Respondent Pagano be ordered to pay to the Petitioner the sum of $5,821.55 with the Petitioner being held responsible for any freight due as a result of this recommendation. It is further RECOMMENDED that if Respondent Pagano fails to timely pay the Petitioner as ordered, then Respondent Sentry be ordered to pay the Department as required by Section 604.21, Florida Statutes (1983) and that the Department reimburse the Petitioner in accordance with Section 604.21, Florida Statutes (1983). Respectfully submitted and entered this 24th day of February, 1985, in Tallahassee, Leon County, Florida. Hearings Hearings 1985. WILLIAM R. CAVE Hearing Officer Division of Administrative The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative this 24th day of February, COPIES FURNISHED: Doyle Conner, Commissioner Department of Agriculture and Consumer Services The Capitol Tallahassee, Florida 32301 Robert Chastain, General Counsel Department of Agriculture and Consumer Services Mayo Building, Room 513 Tallahassee, Florida 32301 F. J. Manuel, Jr., Esquire Post Office Box 3626 Orlando, Florida 32802 Robert Hanshaw and Bruce Hanshaw Post Office Box 996 LaBelle, Florida 33935 Ron Weaver, Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32301 Joe W. Kight, Chief License and Bond Room 418, Mayo Building Tallahassee, Florida 32301 Tony Pagano & Sons, Inc. 62 Brooklyn Terminal Market Brooklyn, New York 11236
