Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Citrus enter a final order dismissing the application filed by the Petitioner for licensure as a citrus fruit dealer. DONE AND ENTERED this 30th day of May, 2013, in Tallahassee, Leon County, Florida. S WILLIAM F. QUATTLEBAUM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of May, 2013. COPIES FURNISHED: Douglas Ackerman, Executive Director Department of Citrus Post Office Box 9010 605 East Main Street Bartow, Florida 33831-9010 Joseph P. Mawhinney, Esquire Reed and Mawhinney, P.L. 1611 Harden Boulevard Lakeland, Florida 33803-1826 Guillermo Vazquez East West Citrus Packers, LLC 11860 Southwest 183rd Street Miami, Florida 33177-2453
Findings Of Fact On August 13, 1984, Mary E. Willis, Respondent, ran an advertisement in the Palm Beach Post Times to which a member of the public responded on August 14, 1984, by phone call. During that phone conversation Respondent offered personal services as defined in Chapter 400, Part II, Florida Statutes, to the caller for care of the caller's mother at 4837 Badger Road, for a specified monthly charge. At the time, Respondent had no valid current license to operate an Adult Congregate Living Facility. On August 18, 1984, Respondent offered to provide personal services as defined in Chapter 400, Part II, Florida Statutes, to two members of the public at 4837 Badger Road, West Palm Beach, Florida. Respondent had no valid current license on this date. On August 18, 1984, two members of the public responded to an invitation by Respondent pursuant to the above advertisement and observed Respondent operating an Adult Congregate Living Facility without a valid current license at 4837 Badger Road, West Palm Beach, Florida.
Recommendation Based upon the above findings of fact and conclusions of law, and also based upon agreement of the parties, it is recommended that a fine of $1500 be assessed against Respondent. DONE and ENTERED this 4th day of April, 1985 in Tallahassee, Florida. DONALD D. CONN, 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 4th day of April, 1985. COPIES FURNISHED: K. C. Collette, Esquire HRS District Nine Legal Counsel 111 Georgia Avenue, 3rd fl. West Palm Beach, Florida 33401 Dorothy M. Walker, Esquire 349 SE 3rd Street Belle Glade, Florida 33430 David Pingree Secretary Department of Health and Rehabilitative Services 1323 Winewood Blvd. Tallahassee, Florida 32301
The Issue Whether Sunny Fresh Citrus Export and Sales, Co., LLC, is liable to Petitioner in the amount of $44,032.00 for delivery of fruit which remains unpaid.
Findings Of Fact Petitioner, DP Partners, Ltd. (Partners), is a Florida Limited Partnership located in Lake Placid, Florida, engaged in the business of citrus production. Daniel H. Phypers and Danielle Phypers Daum, brother and sister, and their father Drew Phypers, are limited partners in the business. Respondent, Sunny Fresh Citrus Export and Sales Co., LLC, (the LLC) is a Florida Limited Liability Company headquartered in Vero Beach, Florida, engaged in the business of exporting citrus for retail sale. The LLC was organized and registered with the State of Florida Division of Corporations on November 3, 2011. The members of the LLC are Kelly Marinaro and Jean Marinaro, husband and wife. Kelly Marinaro (Marinaro) formerly conducted business in the name of Sunny Fresh Citrus Export and Sales Co. (the DBA), a fictitious-name entity registered with the Florida Department of State, Division of Corporations, on October 23, 2007. The fictitious-name entity registration expired on December 31, 2012. Marinaro suffered a massive heart attack in November 2011 and was incapacitated. He did not return to work until the Spring of 2013. On November 4, 2011, after suffering the heart attack, and one day after organizing and registering the LLC, Marinaro conveyed durable power of attorney to Joseph Paladin (Paladin) as his Agent. Among the authority granted to Paladin, was the following: 2. To enter into binding contracts on my behalf and to sign, endorse and execute any written agreement and document necessary to enter into such contract and/or agreement, including but not limited to . . . contracts, covenants . . . and other debts and obligations and such other instruments in writing of whatever kind and nature as may be. * * * 9. To open, maintain and/or close bank accounts, including, but not limited to, checking accounts . . . to conduct business with any banking or financial institution with respect to any of my accounts, including, but not limited to, making deposits and withdrawals, negotiating or endorsing any checks . . . payable to me by any person, firm, corporation or political entity[.] * * * 12. To maintain and operate any business that I currently own or have an interest in or may own or have an interest in, in the future. In Marinaro’s absence, Paladin conducted the usual affairs of the business, including entering into contracts to purchase citrus from several growers. On October 19, 2012, Paladin entered into contract number 2033 with Partners to purchase approximately 6000 boxes of Murcots (a tangerine variety) at $12.00 per box.2/ The contract is signed by Paladin as the Agent of “Sunny Fresh Citrus Export & Sales Company, Licensed Citrus Fruit Dealer (Buyer).” On December 13, 2012, Sunny Fresh entered into contract number 2051 with Partners to purchase Hamlins (a different fruit variety) at $6.50 per box.3/ The contract price was for citrus “on the tree,” meaning it was the buyer’s responsibility to harvest the citrus. The contract is signed by Paladin as the Agent of “Sunny Fresh Citrus Export & Sales Company, Licensed Citrus Fruit Dealer (Buyer).” (Contract 2033 and 2051 are hereinafter referred to collectively as “the contracts”.) The contracts were prepared on pre-printed forms used by Marinaro’s businesses pre-dating Paladin’s involvement. The contract form is titled as follows: Citrus Purchase Contract & Agreement Sunny Fresh Citrus Export & Sales Company Cash Fruit Crop Buyer 2101 15th Avenue Vero Beach, Florida 32960 Paladin testified that he was not aware of more than one company for Marinaro’s fruit-dealing business. He testified that he was not aware of any difference between Sunny Fresh Citrus Export and Sales Company and Sunny Fresh Citrus Export and Sales Co., LLC. Paladin was not aware of when the LLC was created. Paladin’s testimony is accepted as credible and reliable. Paladin testified that his intent was to enter into the contracts for the benefit of “Sunny Fresh.” “Sunny Fresh,” written in twelve-point bold red letters over an image of the sun in yellow outlined in red, is a trademark registered with the Florida Division of Corporations. Marinaro first registered the trademark in February 1998. In his trademark application, Marinaro entered the applicant’s name as “Kelly Marinaro D/B/A Sunny Fresh Citrus.” Marinaro renewed the trademark registration in 2007. Marinaro testified that the “Sunny Fresh” trademark is “owned by the LLC.” On February 20, 2012, Paladin, Marinaro and a third partner, Gary Parris, formed another company, Sunny Fresh Packing, LLC, the purpose of which was to run a fruit-packing house in Okeechobee, Florida. Equipment for the packing house was obtained from a packing house in Ft. Pierce, Florida, which was indebted to Marinaro, in some capacity, and went “belly up.” In March 2013, the Okeechobee packing house was struck by lightning. Shortly after the lightning strike, Marinaro, Paladin, and Mr. Parris, signed a letter addressed “To our valued Growers.” The letter explained that, due to both the lightning strike, which shorted out all computers and electrical components at the packing house, and reduced demand for product due to severe weather in the northeastern United States, they had made a “business decision to end the year now and prepare for next year.” The letter further explained that, “rather than spending thousands of dollars all at once, we feel, it makes better sense to use our cash flow to pay our growers first . . . . We will be sending out checks every week or every other week until everyone is paid or until we receive supplemental cash infusions that we are working on. In that case we would just pay everyone in full, from that.” The letter was prepared on letterhead bearing the “Sunny Fresh” trademark logo. Paladin made a number of payments to Partners on the contracts during 2012 and 2013. Each check shows payor name as “Sunny Fresh” with an address of 2101 15th Avenue, Vero Beach, Florida 32960. Mr. Phypers met with Paladin a number of times to collect checks and understood that Paladin was making concerted efforts to pay all the growers. However, Partners did not receive full payment on the contracts. Paladin drafted a Release of Invoices Agreement (Agreement) by which creditor growers could receive partial payment on their outstanding contracts in exchange for a full release of liability from the buyer. The Agreement lists the following entities and persons as being released from liability: “Sunny Fresh Packing, LLC”; “Sunny Fresh Citrus Export and Sales Co., LLC”; and Kelly Marinaro. Paladin presented the Agreement to Partners with an offer to pay $36,449.45 in consideration for signing the Agreement. Partners did not sign the Agreement. The parties stipulated that the amount owed Partners under both contracts is $44,032.00. Respondent contends that Petitioner’s claim is filed against the wrong business entity. Respondent argues that Petitioner’s contracts were with the DBA, and that Petitioner’s claim is incorrectly brought against the LLC. Thus, Respondent reasons, the LLC is not liable to Petitioner for the monies owed. The DBA was registered with the State of Florida in 2007 and held an active fruit dealer’s license through July 31, 2012. Marinaro owned and operated the DBA at 2101 15th Avenue, Vero Beach, Florida 32960. The DBA filed a citrus fruit dealer’s bond with the Department of Agriculture for the 2008-2009 shipping season. Marinaro registered the trademark “Sunny Fresh” logo in the name of the DBA in 2007, and was still using the logo on his business letterhead in 2013. Marinaro formed the LLC in 2011, which holds an active citrus fruit dealer’s license. Marinaro and his wife, Jean, are the only members of the LLC. The principal address is 2101 15th Avenue, Vero Beach, Florida 32960. The LLC filed citrus fruit dealer’s bonds with the Department of Agriculture on June 28, 2012, for the shipping season ending July 31, 2013, and on May 2, 2013, for the shipping season ending July 31, 2014. Marinaro did not refile a bond for the DBA after forming the LLC. At all times relevant hereto, Marinaro’s fruit dealer’s business has been physically located at 2101 15th Avenue, Vero Beach, Florida 32960. The building at that address bears the name “Sunny Fresh.” Marinaro testified that he formed the LLC shortly after his heart attack to “protect his personal assets.” Marinaro explained that he had little revenue in the LLC “for the next two years,” and he planned for the LLC to conduct sales for the packing company. He expected the LLC would be purchasing fruit from other packing houses. In fact, he testified that, during his absence, he was not aware that either the DBA or the LLC were purchasing fruit. Marinaro was clearly upset about the financial state of his business when he resumed control in the Spring of 2013. He testified that, prior to his heart attack, he was running a business with a typical $10 to $12 million yearly revenue, but that he returned to a business in debt to the tune of roughly $790,000.00. Marinaro lamented that Paladin entered into contracts to buy citrus when that was not the plan for the LLC. Alternately, he blamed Paladin for taking too much money out of the LLC to set up the packing house. Marinaro’s testimony was inconsistent and unreliable. He first testified that Paladin had full authority to purchase fruit in his absence, but later professed to be “dismayed” that his company was purchasing fruit in his absence. The evidence does not support a finding that the LLC was formed for any reason other than to continue his fruit dealings in a legal structure that would protect his personal assets. Marinaro’s explanation that the purpose of the LLC was to conduct sales for the packing company also lacks credibility. The LLC was organized in November 2011, but the packing house in Ft. Pierce from which he acquired the equipment to set up a packing house in Okeechobee did not go “belly up” until February 2012. Marinaro would have had to be clairvoyant to set up an LLC for the sole purpose of sales to a packing house about which he was not aware until four months later. Marinaro’s testimony that he was in the dark about the running of his business and that he was somehow duped by Paladin is likewise unreliable. Marinaro testified that, during his absence, he was “concerned that Paladin was entering into contracts where a bond was required, but not secured.”4/ He could not have been concerned about contracts to buy fruit without posting the required bond if he was not even aware that his company was purchasing fruit. Further, Marinaro neither questioned Paladin about entering into the citrus contracts, nor suggested Paladin use a different contract form for the LLC. The evidence establishes that Marinaro knew Paladin was purchasing fruit during Marinaro’s absence to continue the regular fruit-dealer’s business, and further, that Marinaro knew Paladin was entering into contracts on behalf of the LLC, the company formed just one day prior to Marinaro granting Paladin full power of attorney to run his business. Finally, Marinaro knowingly participated in the formation of Sunny Fresh Packing, LLC, in February 2012, four months after he became incapacitated. This required his involvement in a complicated business scheme in which his company collected on a debt owed by a packing house in Ft. Pierce, and acquired the equipment to run the new packing house, with two partners, Parris and Paladin, located in Okeechobee on property owned by a third party, Mr. Smith, who is not a member of Sunny Fresh Packing, LLC. It is unlikely Marinaro was clueless as to the fruit dealings of the LLC in his absence. Further, it is disingenuous, at best, for Marinaro to suggest that the contracts entered into in 2012 are not with the LLC, the corporation he formed in 2011 to protect his personal assets from his business obligations.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order approving the claim of DP Partners, Ltd., against Sunny Fresh Citrus Export and Sales Co., LLC, in the amount of $44,032.00. DONE AND ENTERED this 30th day of October, 2014, in Tallahassee, Leon County, Florida. S Suzanne Van Wyk Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 2014.
Findings Of Fact In May 1979, Respondent issued invitation for bids for office space in West Palm Beach, Florida, for the purpose of establishing a combined claims, tax, and appeals unemployment compensation office in the West Palm Beach area. The lease on the present office in West Palm Beach expires in December, 1979. Two prior invitations for bids on the required office space had failed to result in the receipt of any bids. The invitation for bids provided that Respondent reserved the right to reject any and all bids and to make the award deemed to be in the best interests of the State of Florida. (Testimony of Bradner, Exhibit 15) On May 30, 1979, Petitioner Richard S. Weinstein submitted the sole bid in response to the May 1979 invitation. He proposed to lease his building located at 1814 North Dixie Highway, West Palm Beach, and to meet all bid specifications and requirements. At the time of bid submission, Petitioner was leasing the building in question to a tenant who operated a used furniture store on the premises. In order to meet the specifications of the bid, the property required considerable renovation and improvement which Petitioner agreed to accomplish. (Testimony of Petitioner, Exhibit 2) A bid selection committee composed of four departmental employees in Respondent's Tallahassee headquarters was appointed to consider Petitioner's bid and arrive at appropriate recommendations. On June 7, 1979, one of the committee members, accompanied by several officials of the West Palm Beach Office, inspected Petitioner's building and the surrounding area to determine its suitability for the proposed unemployment compensation office. Based upon statements made by those officials and the building's tenant that the area was unsafe and subject to frequent vandalism and theft, the committee member thereafter recommended to the selection committee that the bid be rejected and that the Department should readvertise for new bids. The committee unanimously accepted the recommendation and, on June 13, 1979, Petitioner was advised in a letter from the Respondent's support services director that his bid had been rejected based on the "inability of the building to meet our programmatic needs." Petition thereafter protested the decision and, as a result, the Secretary of the Department, Wallace E. Orr, directed the entire committee to make an on-site evaluation of the property and surrounding area. Thereafter, on July 18, 1979, the committee visited the site. At this time, each committee member, together with one of the officials of the local office, inquired of various businessmen in the surrounding area as to local criminal activity and solicited their opinion as to safety and security problems. One of the committee members also telephoned a city police desk sergeant concerning crime statistics in the area. (Testimony of Petitioner, Lowhorn, Orr, Bradner, Exhibits 3-4, 12) Petitioner gave the committee members a petition from a number of local businessmen supporting his bid, and a letter from the nearby Good Samaritan Hospital advising that it may construct a medical office building adjacent to the hospital in the future. Letters were also sent to the Department by the manager of an apartment building adjacent to Petitioner's premises stating that the area was safe and that there had been no break-ins in more than four years, and from the Mayor of West Palm Beach to the Secretary of the Department describing the area and asserting that it was making a resurgence in character as a result of city improvements and that it was no more unsafe than most of the areas of the city. Another letter, dated July 20, 1979, was sent to the Department from the West Palm Beach Downtown Development Authority Executive Director stating that the area was growing, new buildings were being developed, and that the downtown area generally was becoming a "hub" for governmental facilities. Upon return to Tallahassee, each member of the bid committee rendered a report and recommendations concerning Petitioner's bid. They applied weighted criteria in its consideration, and concluded that the bid was unacceptable because it failed to meet the two criteria of "condition of immediate vicinity of location" and "security of the facility." In these respects, they basically found that (a) the various businesses in the area were essentially "fortified" against burglary and vandalism, (b) the proposed office would be subjected to break-ins and possible loss of valuable office equipment and unemployment compensation checks, (c) the local departmental employees would be fearful of working in an unsafe area and (d) an office located at Petitioner's premises would be "depressing" to members of the public who utilized the departmental services. No mention was made in the various reports of the petition or letters sent to the Department by civic officials. The committee again recommended rejection of the bid and, by letter of August 1, 1979, Petitioner was advised of this fact and that new calls for bids would be made in the near future. Secretary Orr had viewed the premises himself and agreed with the committee recommendations that the site was unsuitable for the establishment of a local office. He felt that placement of the office in the area where Petitioner's building was located would be inconsistent with departmental goals to upgrade their state offices and improve their "image." He had not been made aware of most of the various letters and the petition provided to the committee, but had considered the letter of the West Palm Beach Mayor prior to arriving at his decision. (Testimony of Butler, Frisch, Radner, Baker, Orr, Lowhorn, Renfroe, Quigg, Petitioner, Exhibits 6-10, 11-12, 16) The street on which Petitioner's building is located is commercial in nature, although it is on the fringe of a residential community. It is an older part of the city and, until about five years ago, was in a rundown and depressed condition. In recent years, however, there has been an upgrading of the character of the downtown area of West Palm Beach which extends northerly to encompass the businesses in Petitioner's vicinity. The establishment of governmental facilities in the downtown and adjacent areas have been encouraged and a state office building is located in the area. A Department of Health and Rehabilitative Services "halfway house" has been erected approximately two blocks from Petitioner's building. Additionally, a branch banking facility, professional offices, several quality restaurants, and other modern business establishments are in the near vicinity. A laundry plant is across the street from Petitioner's building and at the present time presents an unsatisfactory appearance. It is intended, however, by the owners to expand and remodel the building in the near future. The City of West Palm Beach has the second highest crime incident rate in the state based on population. The city is divided into ten zones for police purposes, and during 1978, the zone in which Petitioner's building is located was average from the standpoint of crime statistics. In the opinion of the City Chief Police Inspector, it is typical of the various commercial areas located along U.S. Federal Highway No. 1, and as safe an area in the daytime as any in the city. He is of the further opinion that a burglar alarm would be a sufficient security precaution for nighttime safety, and that with such protection, a building would have adequate security. The highest crime rate in the city is located in the zone where the city hall, police station and other governmental buildings are located. Although business and professional individuals in the area near Petitioner's building have experienced minor vandalism and occasional illegal entries in the past, they uniformly are of the opinion that the area is safe with normal security precautions, such as a burglar alarm. A local boat sales establishment has a fence around the premises and a watch dog, but no burglar alarm. These precautions are designed to protect the expensive boats which are located out- side the building. The apartment building next to Petitioner's premises has not experienced break-ins in recent years although some of its elderly patrons have been exposed to occasional purse snatching on the street. The laundry plant across the street from Petitioner's building experiences various window breakage by youths on the weekends, and had a break-in recently in the nighttime through a poorly secured door in the rear of the premises. (Testimony of Lowhorn, Stackhouse, Hauser, Hodges, Lee, Lunney, Eddy, Ring, Eaton, DeSanti, Witt (Deposition - Exhibit 1), Exhibits 12-14).
Recommendation That Petitioner's bid be accepted by Respondent and recommended for approval to the Department of General Services. DONE and ENTERED this 17th day of December, 1979, in Tallahassee, Florida. THOMAS C. OLDHAM Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: John C. Moyle, Esquire 707 North Flagler Drive Post Office Box 3888 West Palm Beach, Florida 33402 Kenneth H. Hart, Jr. and Chad J. Motes, Esquires Department of Labor and Employment Security 2561 Executive Center Circle E. Suite 131 Tallahassee, Florida 32301
The Issue The issue presented for determination herein is whether or not the existing Pontiac dealers serving the West Palm Beach area are providing inadequate representation.
Findings Of Fact Art Moran filed an application with the Department seeking licensure as a franchised Pontiac-GMC motor vehicles dealer. The GMC license is not at issue herein. By its application, it sought the issuance of a license to operate a new Pontiac dealership in Palm Beach County on Northlake Boulevard (stipulation of the parties). A letter of protest to the application was timely filed by Stewart pursuant to Section 320.642, Florida Statutes. (stipulation of the parties) THE MARKET AREA The relevant market area for purposes of Section 320.642 is the West Palm Beach multiple dealer area (MDA). 1/ The West Palm Beach MDA consists of the densely populated portion of eastern Palm Beach County (Exhibits 9-10). The West Palm Beach MDA has been divided into three smaller markets known as areas of geographic sales and service advantage ("AGSSA") (GM Exhibit 6-7). AGSSA's are developed by GM as a dealer network planning tool. (I-92, 100, 103). Each AGSSA consists of those census tracts closest to a proposed or existing dealer and identifies an area of shopping convenience for consumers in that AGSSA. (GM Exhibits 19 and 20) Each AGSSA represents the area in which an existing or proposed resident dealer has or would have an advantage over the same line make dealer(s) in the MDA by virtue of the resident dealer's location. (I-103). AGSSA I is that portion of eastern Palm Beach County generally lying between 45th Street and Lantana Road. AGSSA II is south of AGSSA I and essentially surrounds the Delray Beach area. AGSSA III is the area of Palm Beach County north of 45th Street where Art Moran has proposed to be located. (GM Exhibit 6, 7). Stewart offered no alternative market definition for performing a registration penetration analysis of the West Palm Beach community. MARKET PENETRATION IN THE WEST PALM BEACH MDA General Motors conducts periodic analyses of market penetration in each MDA by reviewing registration data provided by R. L. Polk and Company ("Polk") at both the county and census tract levels (GM Exhibit 8). The registration data provided by Polk includes every vehicle registered to an address within a particular area of geography (county or census tract) regardless of the selling dealer. Stewart raised an issue during the hearing respecting the reliability of certain market penetration data gleaned from the Polk figures for 1985. This issue was raised based on the parties' inability to affirmatively state whether certain transactions calculated by Polk were fleet or retail transactions. Both parties relied on the Polk data and it is the industry standard for tracking automobile registrations. The Polk data is reliable for the purposes introduced by GM. Adequacy of representation is primarily determined by using retail registration data. The Polk data includes the components of retail and fleet as well as total registrations. (GM Exhibits 25-27). Both parties have used Polk retail registration data to analyze market penetration. (GM Exhibits 25-35, Stewart Exhibits I-N). Retail market penetration is a relative concept that compares the retail registration of one line make with all industry registrations in a particular geographic area. For example, 7.02 percent of all the vehicles registered in the Jacksonville zone for retail use were Pontiac in 1985. Thus, Pontiac's market penetration in the zone was 7.02 percent. (I- 107; GM Exhibit 17). Correspondingly, 5.32 percent of all retail vehicles registered in the West Palm Beach MDA in 1985 were Pontiacs for an MDA average of 5.32 percent, or 1.70 percent below zone average. (GM Exhibits 34 and 35). Market penetration compares total industry retail registrations in an area to the retail registrations of a particular line make in that area. An individual dealer's sales records are not helpful when evaluating market penetration. Retail registration efficiency to Jacksonville's zone average is the percentage relationship between retail penetration in a geographic area and zone penetration. In 1985, the retail registration efficiency of the West Palm Beach MDA to zone areas was 75.8 percent, the lowest penetration in the Jacksonville zone. (GM Exhibit 3). Retail registration efficiency in the West Palm Beach MDA has steadily declined since 1985. (I-154, 155, 157; GM Exhibit 27 utilizing the Polk community registration reports). MDA Retail Reg: 1981 1982 1983 1984 1985 March, 1986 annualized INDUSTRY 31,845 31,328 39,273 42,247 43,797 41,128 PONTIAC 2,356 2,220 2,590 2,639 2,460 2,152 PONTIAC percent 7.4 7.1 OF INDUSTRY 6.6 6.4 5.6 5.2 Zone Retail Reg: PONTIAC percent 8.5 7.4 7.4 7.2 7.0 7.6 OF INDUSTRY Further, from 1981 to 1985, industry retail registrations in the MDA have increased 11,952 vehicles or 38 percent while Pontiac retail registrations increased only 104 units or 4 percent (GM Exhibits 27 and 28). Stewart's sales increased only 41 units or 3 percent in the same time period. (I-159). The sales performance of the West Palm Beach dealers has declined 10 percent from 1984 to 1985. Stewart's sales were also down in 1985 (I-159). Perhaps a contributing factor to Stewart's sales performance is his practice of putting supplemental dealer price stickers averaging $800 extra on each car. According to Mr. Stewart, such additional charges make cars more difficult to sell (GM Exhibit 66, p. 345). In 1985, the Pontiac West Palm Beach MDA ranked 123rd in retail penetration when compared with the 159 largest Pontiac markets in the United States. (I-95; GM Exhibit 4). Based on retail penetration, the West Palm Beach MDA has been the worst MDA in Pontiac's Jacksonville zone since 1983 (GM Exhibits 30, 32 and 34) In AGSSA III The most current registration data available at the AGSSA level is year-end 1985 data. This data was available to both parties prior to the hearing. The parties agree that the most current data is required to do market research. In this regard, Stewart relied on outdated data in a number of its exhibits (see, for example, Stewart Exhibits D, J, O, P and W.) The West Palm Beach MDA retail penetration has been consistently below zone and national retail penetration. (GM Exhibit 27). AGSSA III has repeatedly had the worst penetration in the MDA (GM Exhibit 35). For the years 1983, 1984 and 1985, Pontiac's retail penetration figures nationally in the Jacksonville zone, in the West Palm Beach MDA and in the three AGSSA's were as follows-utilizing census tract reports: Zone National West Palm Beach MDA AGSSA 1 AGSSA II (middle) (south) AGSSA III (north) 1983 7.42 6.13 6.86 7.8 6.3 6.2 1984 7.15 6.00 6.41 6.8 6.3 5.9 1985 7.02 6.99 5.32 5.6 5.4 4.7 Recognizing the growth in northern Palm Beach County, Pontiac established AGSSA III as a study area--an area set aside to determine the potential for representation--as early as 1978. Due to the growth, the decline in market penetration, and other factors, the study was converted to a proposed additional point. An additional dealer in an area tends to increase market penetration in its line make to the benefit of the existing same line make dealers. (GM Exhibits 49, 50, 54, 55 and 57). The parties agreed that size class is a factor that may be considered in addressing market penetration. (GM Exhibits 38 through 40; Stewart Exhibits I through Q). Mr. Gahrs testified that model mix is not as significant as line make. Pontiac competes with the full line of vehicles offered by Ford, Chevrolet and the imports (I-168). LOST OPPORTUNITIES "Lost opportunities" is the difference between actual Pontiac retail registrations in an area and the number of registrations that would have occurred had a given norm (i.e. zone average penetration) been achieved. The number of lost opportunities represents the number of registrations available to the Pontiac dealers in the MDA had zone average penetration been attained. (GM Exhibits 30, 32, 34, 39 and 40). The parties agree that lost opportunities exist in AGSSA III and that those losses are increasing: LOST OPPORTUNITIES COMPARED TO ZONE RETAIL PENETRATION 1983 1984 1985 Zone Penetration 7.42 7.15 7.02 MDA (241) (312) (733) AGSSA I no loss (54) (227) AGSSA II (182) (164) (320) AGSSA III (84) (95) (187) The above graphically portrayed the poor market penetration in the West Palm Beach MDA and AGSSA III. (GM Exhibits 30 through 35). Stewart also recognizes the theory of lost opportunity but calculates the loss by comparing the MDA to itself. The car loss which has almost doubled from 1984 to 1985 appears to be growing, based upon the first three months of 1986. Annualized for 1986, the MDA car loss will be 976 (GM Exhibit 27). The lost opportunity in the MDA when adjusted for product popularity drops slightly. However, when the high level of in-sells (cars sold by dealers outside an area but registered in an area in the West Palm Beach MDA) is considered (GM Exhibit 21), the lost opportunity to the dealers doubles from 733 to 1,524 (GM Exhibits 22, 34 and 35). The parties agree that high levels of in-sells can be caused by deficient dealer performance or inadequate representation. The parties also agree that there is a shortfall in registration performance in AGSSA III and that lost opportunities exist in AGSSA III. (GM Exhibit 34; Stewart Exhibit Q, last two pages). CUSTOMER CONVENIENCE The parties also agree that if a manufacturer offers better convenience, better penetration will result. According to Mr. Stewart, the closer the people are to his dealership, the higher the penetration. (GM Exhibit 66, page 332). In fact, there is a high concentration of retail registrations surrounding each Pontiac MDA dealer. (GM Exhibits 19 and 20). Stewart, the Pontiac dealer with the best level of convenience (4.5 miles) has the highest level of sales (1,391 sales) and the highest level of penetration in the MDA (5.6 percent). (Stewart Exhibit E, weighted average distance by dealer, by AGSSA; GM Exhibit 35). In AGSSA III, where Pontiac has its lowest level of customer convenience in the MDA, Pontiac retail penetration is also lowest. (GM Exhibits 35 and 45). Potential buyers in AGSSA's I and II enjoy far greater convenience to the nearest Pontiac dealer than does a potential buyer living in AGSSA III. (GM Exhibit 45; Stewart Exhibit E, Section 2, page 2). All manufacturers represented in AGSSA I and AGSSA II offer similar levels of convenience. On the other hand, the average consumer must travel almost twice as far from his residence in AGSSA III to reach a Pontiac dealer than to reach a Chevrolet, Honda, Ford, Nissan, Volkswagen or Toyota dealer. Correspondingly, Chevrolet, Honda, Ford, Nissan and Volkswagen have higher penetration in AGSSA III than their MDA average. (GM Exhibits 43 and 44). Easy access to a dealer can help improve penetration for a manufacturer. Similarly, an improper location can result in low penetration. (GM Exhibit 43). The sales and service facilities offered by the existing Pontiac dealers in AGSSA's I and II are or soon will be adequate. However, even expanding, optimally located facilities cannot adequately serve a large and growing market. Facilities expansion will not, standing alone, result in increased sales, improved penetration or higher rates of registrations. The West Palm Beach market has simply outgrown the existing 2-dealer network for Pontiac. Proximity is the distance between the home address of a customer or prospective customer of an automobile and the location of the selling dealer. The parties agree that proximity relates to intra-brand competition--competition among dealers of the same line make, and inter-brand competition--competition among dealers of different line makes. The parties also agree that proximity affects intra-brand competition. Seventy-five percent of Pontiac buyers in West Palm Beach travel to the closest Pontiac dealer to purchase a Pontiac. Nationally, sixty percent of purchasers buy from the nearest dealer. (Stewart Exhibit F, Power's Study). The majority of Pontiac purchasers in West Palm Beach are proximity sensitive. Proximity affects inter-brand competition. Manufacturers providing convenience to customers in AGSSA III have a greater opportunity to enjoy above- average penetration performance than manufacturers that do not offer similar levels of convenience. (GM Exhibits 43 and 44; Stewart Exhibit S). Further, Dr. Ostlund admits that the addition of a different line make dealer in AGSSA III could adversely affect Pontiac if it is not represented in AGSSA III, but he cannot determine the degree of the impact. Further indication that proximity affects inter-brand competition is a 1980 Power's Study of Pontiac purchases. That study showed that 72.4 percent of Pontiac purchasers nationwide visited one or more different line make dealerships before buying a Pontiac. The availability of a Pontiac dealership to proximity sensitive buyers is therefore very important. The Power's Study, deemed reliable by Stewart, contradicts the 1958 Ford study offered by Dr. Ostlund. (Stewart Exhibit F, Ford study). The Cort Dissertation, another source recognized by Stewart as reliable, also cautioned against broad use of the Ford results due to the methodology employed therein. Proximity only becomes a factor for Pontiac, however, when the competition offers relatively better level of proximity in comparison to Pontiac. The addition of a Pontiac dealer in AGSSA III would provide Pontiac customers convenience commensurate with the convenience offered by competitive line makes. Further, the customer convenience offered by Pontiac in AGSSA III would be twice as good as the convenience currently offered by Pontiac in AGSSA III and would be consistent with its convenience offered (by Pontiac) in AGSSA's I and II. (GM Exhibits 44 and 45). The proposed Pontiac location in AGSSA III will be 8.1 air miles from its nearest same line make competitor in AGSSA I. That distance is greater than the distance between the Ford, Toyota, Nissan, Volkswagen and Chevrolet dealers in AGSSA III and their nearest same line make competitor. Thus, the distance of the proposed Pontiac dealer from Stewart is consistent with the respective distances between nearest same line make dealers in the MDA. (GM Exhibit 46). Measured by the shortest route in non-rush hour traffic, drive time from the proposed Art Moran location to the Stewart location is long when compared to the convenience levels offered by other line makes. The drive time between the two locations range from 12:50 minutes (Stewart Exhibit C, second to last page) to 14:30 minutes (GM Exhibit 1, page 35) via Interstate 95. The drive time between the proposed location and Stewart's location via US 1 is over 23 minutes (GM Exhibit 1, page 34). A consumer living in a typical residential area in AGSSA III, such as Old Port Cove traveling to Art Moran would travel less than half the time now required to reach Stewart and drive less than one- fourth of the distance (GM Exhibit 1, pages 34 and 35) Pontiac's lack of competitive convenience in AGSSA III is a significant factor in its inadequate retail market penetration. Stewart offered no current data or objective, quantifiable evidence to rebut GM's evidence that customer convenience is directly related to retail market penetration. THE STANDARD Pontiac's zone average penetration, 7.02 percent, is a reasonable norm to use in evaluating the West Palm Beach MDA for five reasons: All Florida markets exceeded national average in 1983, and three of those markets exceeded zone average. In West Palm Beach, AGSSA I exceeded both the zone and national average. (GM Exhibits 30 and 31). Pontiac's penetration in Jacksonville and Pensacola exceeded both zone and national average in 1984. In West Palm Beach, AGSSA I was virtually at national average. (GM Exhibits 32 and 33). Adjusting for product popularity, the MDA should be attaining a penetration level of 95 percent of zone average (GM Exhibits 39 and 40). The demographic characteristics of the community approach national average. (GM Exhibits 36 and 37). Some census tracts in the West Palm Beach MDA are currently attaining or exceeding zone and national average penetration. (GM Exhibits 17 and 18). To develop a reasonable norm, it is necessary to determine what level of penetration an MDA can attain. Selecting a market which is inadequate to develop a standard of adequacy is not proper. Nor is it proper to compare an MDA with a level it is achieving in a given year and contend that it has achieved its full potential. Zone or national average penetration is the proper level of performance for an MDA that is performing at substandard levels. Compared to the 1985 zone average of 7.02 percent, only 5.32 percent of the vehicles registered in the MDA were Pontiacs, and in AGSSA III only 4.66 percent of the vehicles registered were Pontiacs. That deficiency results in a penetration shortfall of 733 units in the MDA compared to zone average (GM Exhibits 34 and 35). That lost opportunity is even more significant in AGSSA III where the lost units amount to 187 in an area where only 369 Pontiacs were registered in 1985 (GM Exhibits 34 and 35). THE NEED FOR MARKET REPRESENTATION Pontiac is not achieving adequate levels of penetration in either the West Palm Beach MDA or in AGSSA III. The cause of that inadequacy is that the market has outgrown the existing 2-dealer network for Pontiac. Since 1950, population in the MDA has increased seven-fold, but the number of dealers has remained at two (GM Exhibit 42). In Florida, the ratio of population to approved Pontiac dealer points is approximately 250,000 to 1 (GM Exhibit 42). The ratio of registrations per approved dealer point is approximately 10,000 to 1 (GM Exhibit 41). Based on the size of the market alone, West Palm Beach could support at least one additional dealer. The relative levels of convenience in the MDA also support additional Pontiac representation in AGSSA III. Six manufacturers offer higher levels of relative convenience to AGSSA III buyers than does Pontiac: Volkswagen, Honda, Chevrolet, Ford, Nissan and Toyota (GM Exhibit 44). Those manufacturers have a competitive advantage over Pontiac in AGSSA III. The most recent data available supports the proposition that, in order to have an opportunity to achieve areas of better than average penetration in an area, a manufacturer must be represented in that area (GM Exhibits 43 and 44). Of the 13 major line makes represented in the MDA, only those manufacturers represented in AGSSA III exceed their MDA average in that AGSSA (GM Exhibit 43). Convenience is not an issue in AGSSA's I and II where relative proximity is provided by all manufacturers. However, in AGSSA III, the prospective Pontiac purchaser must travel twice as far than other Pontiac purchasers in the MDA (GM Exhibit 45), and twice as far as purchasers of vehicles from manufacturers represented in AGSSA III to purchase a vehicle (GM Exhibit 44). The distance between the proposed Art Moran site and Stewart is consistent with the distance between dealers in AGSSA's III and the closest same line make dealer in AGSSA I (GM Exhibit 46). Lack of proximity was one factor influencing those individuals in AGSSA III who desired a Pontiac, but who did not purchase Pontiacs since seventy-five percent of Pontiac purchasers in the MDA are proximity-sensitive. Pontiac cannot be adequately represented in AGSSA III without establishing an additional dealership in AGSSA III. In 1985, the AGSSA I dealer placed 24 percent of its retail sales in AGSSA III (GM Exhibit 47) and the AGSSA II dealer placed less than five percent making it an insignificant factor in AGSSA III (GM Exhibit 22). To correct the penetration shortfall in AGSSA III, the AGSSA I dealer would have to sell over 750 additional units, an 80 percent sales increase (GM Exhibits 27, 28). This is highly unlikely given the historically flat sales performance of Stewart (GM Exhibit 27). It is industry practice to place a dealer in a market where market penetration is lowest. In order to achieve above-average penetration, a manufacturer must be represented (GM Exhibits 43, 47, 49, 50, 54-57). The combined efforts of the new dealer in an area coupled with those of the next closest dealer are usually required (GM Exhibit 47). Dealer additions in other markets have resulted in a consistent pattern (GM Exhibits 49, 50, 54-57): The existing dealers improve their sales performance; Penetration efficiency increases; and The distribution pattern of the dealer adjacent to the new point remains constant, despite addition of a dealer. GROWTH OF THE WEST PALM BEACH AREA Since 1950, the population of the area as a whole has increased more than sevenfold. The metropolitan area is expected to be the fastest growing in the nation by the turn of the century. (Moran Exhibit 1, Florida Forecast, January 1, 1986) There has been no change in the Pontiac dealer count in the last 36 years (GM Exhibit 43). Palm Beach County's 1985 population was 713,253, a 23.6 percent increase over the 1980 population of 576,863. (GM Exhibit 1, Table 1) As significant as that increase is, it is less than the 1980-85 increase experienced in AGSSA III, which went from 111,228 to 140,007 or a 26.1 percent increase (GM Exhibit 1, Tables 30 and 31). Dealers are usually added in growing areas. Palm Beach County has become economically diversified and its population is heterogeneous. AGSSA III mirrors these patterns. Consistent with these trends in population are increases in households, construction, employment, which are all growing rapidly for Palm Beach County as a whole and even faster for AGSSA III. (GM Exhibit 1, Tables 27 and 28) Per capita income, as well as the average household income, remains high in Palm Beach County and in AGSSA III. (GM Exhibits 12, 13 and 14) Moreover, in 1985 all but one of the census tracts in AGSSA III had a median household income higher than the county median. (GM Exhibit 1, Table 34) Most of the people of driving age in the market can afford automobiles. In fact, people in the country spend more on their automotive needs, in the aggregate, than on food. Similarly, all measures of residential and industrial commercial growth indicate substantial growth for Palm Beach County as a whole and even more growth in AGSSA III (GM Exhibit 1, Tables 2-7, and GM Exhibit 2). Building permit valuations have increased 700 percent from 1975 to 1985. Residential construction, either underway or approved, reflects the actual and anticipated growth of population in Palm Beach County. Retail sales in Palm Beach County increased 47 percent from 4.5 million dollars in 1980 to 6.6 million dollars in 1985. From 1984 to 1985, the civilian labor force increased by more than 3 percent, employment increased 4.6 percent and unemployment decreased 15.2 percent (GM Exhibit 1, Table 14). Large industrial and commercial firms such as IBM and Pratt and Whitney have located in AGSSA III. Traffic counts near the proposed point more than doubled from 1976 to 1984. (GM Exhibit 1, Table 35) Traffic volume is 5 times greater on I-95 near the location of the proposed dealer than on US-1 where Stewart is located. The "explosive" growth in the northern part of the West Palm Beach MDA has attracted extensive public and media attention. Research conducted by Mr. Stewart revealed a special section in the Palm Beach Post headline "Horizon Bright for North County." (Moran Exhibit 1, Palm Beach Post, July 21, 1985) As stated by the mayor of Palm Beach Gardens, "We are ready to explode. This is the hot spot for development." A regional mall is being constructed on PGA Boulevard in AGSSA III. The distance between this new mall and its nearest competitor to the south is similar to the distance between Moran's proposed location and Stewart. This mall, located in Palm Beach Gardens, "is actually a downtown. . . The 322 million dollar project combines residential, commercial and retail uses on property on the north side of PGA Boulevard between US-1 and Alternate A1A." (Moran Exhibit 1, Palm Beach Post, July 21, 1985, p. F-4) In addition to the development in the northern section of the county (essentially AGSSA III), development in the central section of Palm Beach County is also significant. Stewart, located in AGSSA I just east of the central section of Palm Beach County, is in a position to take advantage of this growth. Growth in the areas near the existing and proposed dealerships is strong. DEMOGRAPHICS Growth has led to demographic diversity in Palm Beach County. While the very wealthy remain, they have become less important as the middle and upper middle income groups have grown. Palm Beach County has become more like other urbanized counties in Florida. The entire MDA, in AGSSA III in particular, show heavy concentrations of household annual incomes between 15 and 40 thousand dollars and at levels above 40 thousand dollars (GM Exhibits 36 and 37). As of 1985, there were no census tracts in AGSSA III where the average household income was less than 15 thousand dollars. West Palm Beach and AGSSA III have residents in every age group. (GM Exhibit 36) Stewart has not performed any study which demonstrates a link or relationship between demographics and market penetration. ALLOCATION The Pontiac allocation system is based upon the number of sales reported by a dealer. The more cars sold by the dealer, the more car the dealer earns from the factory. Stewart Pontiac has had a history of not reporting sales promptly. Earl D. Stewart recognized the benefits of the Pontiac allocation system when he testified in the Fischer-Mazda case in 1980. In discussing the Phoenix, a hot or popular car that year (a car easy to sell), he compared the Pontiac system to that of Mazda. (GM Exhibit 66, pages 311-312): I would say that the Phoenix shortage compares most closely of any car I have in the line with the Mazda problem. However, the interesting thing with the Phoenix is that through sales efforts there is a direct correlation between selling more cars and earning more cars. . . With the Phoenix I have started out with a relatively small number of cars, and through my rates of sales, I have earned additional cars. So my experience, since the new X-body came out, I have earned additional products. Stewart maintains a large number of vehicle orders to ensure sufficient numbers of vehicles to sell. While Mr. Stewart suspects that other Pontiac dealers have a greater supply of popular vehicles and estimates that other manufacturers have more new cars at model introduction, he admitted that "my total inventory compares equitably with other Pontiac dealers in the zone. . ." (III-51) CUSTOMER SATISFACTION Both Pontiac and its dealers strive to satisfy the ultimate customer-- the automobile purchaser. Both the manufacturer and dealer must provide a level of satisfaction the customers expect. The customer is the best judge of whether satisfaction has been achieved. Customer satisfaction is measured through an involved market research procedure. General Motors measure customer satisfaction with both the product and the selling dealer. Overall experience with the selling dealer measures the customer satisfaction with the dealer's sales staff, delivery condition of the vehicle, and warranty service. 2/ Most dealers with low CSI ratings usually offer customers poor service (Montgomery deposition, pages 4 and 5). Responses from consumers regarding overall satisfaction are verified and evaluated. The parties agree that higher CSI scores are preferable. CSI results are used as a management tool. CSI assist the zone office and the dealer to identify problems in the dealership and allows the dealer an opportunity to correct noted deficiencies. Zone average is the minimum level of satisfaction acceptable to General Motors. Zone average is sales weighted, which tends to reduce the standard below the average of all consumer responses in the zone. A dealer whose CSI rating is below zone average is not providing the levels of satisfaction expected by either GM or the customer. Stewart Pontiac is significantly below zone average and does not provide adequate representation of GM relative to the other zone dealers. Over the past six quarters, Stewart Pontiac's CSI has declined from 6 points below zone average to 10 points below zone average: Quarter Zone Average CSI Stewart Pontiac CSI Difference 4th-1984 75 69 (6) 1st-1985 76 69 (7) 2nd-1985 77 71 (6) 3rd-1985 77 69 (8) 4th-1985 77 67 (10) While other dealers have improved their CSI during this period of time, Stewart has consistently been one of the worst performing dealers in the zone. The other Pontiac dealers in the MDA are performing at zone average. As of March, 1986, Stewart Pontiac is 13 points below national average and 10 points below zone average, a statistically significant difference. Moreover, developing a comparison with certain sub-groups of dealers, Stewart Pontiac is significantly below those averages. Utilizing GM's methodology, the parties agree that there is a significant difference between Stewart and any other sub-group or combination thereof (GM Exhibit 67). Comparing all GM dealers in West Palm Beach, the ratings range from 67 to 90. Stewart Pontiac is at67, six points below the nearest automobile dealer (GM Exhibit 59). Stewart Pontiac is the lowest rated dealer in West Palm Beach. Indeed, in terms of product evaluation, Cadillac is rated lower than Pontiac, yet the Cadillac dealers in West Palm Beach are able to perform at higher levels of satisfaction for their customers. CUSTOMER SERVICE PROVIDED BY STEWART PONTIAC Stewart Pontiac receives the same products as other Pontiac dealers. The Pontiac zone office has sent personnel over to Stewart Pontiac in order to assist the dealership in improving its CSI rating. About the same time as the protest was filed, Stewart Pontiac commenced improvement efforts (GM Exhibit 65). Stewart's CSI improvement program was necessitated by the absence of any such program at the dealership (Montgomery deposition, pages 15-17). The attitude of the dealer and desire of its management to improve CSI will have a greater impact on CSI performance than the mere spending of substantial sums as a means to correct a CSI problem. Clyde Montgomery, Pontiac's district manager, is familiar with the CSI for Stewart Pontiac. Montgomery has discussed the improvement programs with Stewart's dealership personnel and expects Stewart's CSI to increase. Montgomery noted that there were numerous attitude problems at the dealership which needed attention to include the following: Customer relations manager, recently hired and has little authority; Service manager is not consumer oriented; Earl D. Stewart does not appear to have a sufficient interest in the service department; The dealership has not properly implemented a number of programs suggested. To improve a CSI rating, the dealership must be attentive and a positive attitude must be sustained to earn the approval of its customers. IMPACT OF SERVICE ON PENETRATION Dealers with higher sales rates usually have lower CSI ratings. However, there are major exceptions to that rule. Three of the top ten dealers in the Jacksonville zone have high CSI ratings. Both parties agree that good service leads to customer retention and increased sales while poor service means lost sales. As Dr. Ostlund stated (IV-215, 216): There is no question that people are more likely to buy a car from their nearest Pontiac dealer, but that is not something that is axiomatic. They will buy a car from other dealers if there are reasons that prompted that condition, such as. they may buy from a dealer who is known to have a good service operation . . . Convenience of service is extremely important to a dealer after the warranty expires. (GM Exhibit 66, page 292) The proposed Art Moran dealership would provide prospective purchasers a high level of convenience and increased market penetration. Service convenience is an important factor in establishing a dealership. Convenience for service returns is at least if not more important to a customer than convenience for purchasing. If a dealer is too far, a consumer may not return to the dealer but have work done elsewhere. AGSSA III customers must drive longer distances for both sales and service than the average customer in the MDA.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Art Moran Palm Beach Pontiac-GMC Inc., application for a motor vehicle dealer license as a Pontiac dealer be GRANTED. RECOMMENDED this 5th day of September, 1986 in Tallahassee,, Florida. JAMES E. BRADWELL 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 5th day of September, 1986.
The Issue The issue before the Florida Land and Water Adjudicatory Commission (FLWAC) in this proceeding is whether to grant the Amended Petition to Establish the Palm Coast Park Community Development District (Amended Petition) dated October 13, 2004. The local public hearing was conducted for the purpose of gathering information in anticipation of rulemaking by FLWAC.
The Issue The issue in this case is whether the Petition to Contract the Tampa Palms Open Space and Transportation Community District should be granted.
Conclusions Section 190.046(1), Fla. Stat. (1995), provides for the filing of a petition for contraction of a community development district under the provisions of Section 190.005. Under paragraphs (f) and (g) of Section 190.046(1), petitions to contract a CDD by 2,357 acres “must be considered petitions to establish a new district and shall follow all of the procedures specified in s. 190.005.” Under Section 190.005(1)(e), Fla. Stat. (Supp. 1996), the Florida Land and Water Adjudicatory Commission (FLAWAC) must consider the following factors in determining whether to grant or deny a petition for the establishment of a CDD: Whether all statements contained within the petition have been found to be true and correct. Whether the creation of the district is inconsistent with any applicable element or portion of the state comprehensive plan or of the effective local government comprehensive plan. Whether the area of land within the proposed district is of sufficient size, is sufficiently compact, and is sufficiently contiguous to be developable as one functional interrelated community. Whether the district is the best alternative available for delivering community development services and facilities to the area that will be served by the district. Whether the community development services and facilities will be incompatible with the capacity and uses of existing local and regional community development services and facilities. Whether the area that will be served by the district is amenable to separate special- district government. Factor 1 In this case, all statements contained within the petition for contraction have been found to be true and correct. However, as found, the petition for contraction does not contain the written consent of the owners of all of the real property to be included in the new TPOSTCDD, after contraction; nor was there any documentation or other evidence demonstrating that either the TPOSTCDD or those giving their written consent to the contraction have control by deed, trust agreement, contract, or option of 100 percent of the real property to be included in the new TPOSTCDD, after contraction. Section 190.005(1)(a)2, Fla. Stat. (Supp. 1996), requires that a petition for establishment of a CDD contain the written consent of the owners of all of the real property to be included in the proposed CDD, or documentation demonstrating that the petitioner has control by deed, trust agreement, contract, or option of 100 percent of the real property to be included in the proposed CDD. (Section 190.046(1)(e), Fla. Stat. (1995), requires the written consent of all landowners whose land is being deleted through contraction, but paragraphs (f)-(g) of Section 190.046(1) would appear to require the petition to contract in this case follow all of the procedures specified in s. 190.005, including the requirement of Section 190.005(1)(a)2, Fla. Stat. (Supp. 1996).) It is noted that the petition for contraction in this case contains an economic impact statement that not only contains a statement of estimated regulatory costs in accordance with Section 120.541, Fla. Stat. (Supp. 1996), but also contains several other estimates of economic impact, in accordance with Section 120.54(2), Fla. Stat. (1995). Factor 2 It was found, supra, that the creation of the proposed TPOSTCDD, after contraction, is consistent with applicable elements and portions of the state comprehensive plan and the effective local government comprehensive plans. Factor 3 It was found, supra, that the proposed TPOSTCDD, after contraction, will be of sufficient size, sufficiently compact, and sufficiently contiguous to be developable as one functional interrelated community. Factor 4 The evidence in this case was that, due to the existence of the major infrastructure along the spine of County Road 581, and the ownership of Areas 4 and 8 by a different developer, contraction of the TPOSTCDD by deletion of Areas 4 and 8 will have no adverse impact on the issue whether the proposed TPOSTCDD, after contraction, is the best alternative available for delivering community development services and facilities to the area that will be served by it. It was found in the Recommended Order and Report in DOAH Case Number 89-3654 that the existing TPOSTCDD is the best alternative available for delivering community development services and facilities to the area that is served by it. Presumably, that finding supported the adoption of F.A.C. Rules Chapter 42J-1, which created the existing TPOSTCDD on January 31, 1990. Using the legal principle of res judicata, it can be deduced that, since contraction will have no adverse impact on this issue, the proposed TPOSTCDD, after contraction, still is the best alternative available. Factor 5 It was found, supra, that the proposed TPOSTCDD, after contraction, will be compatible with the capacity and uses of existing local and regional community development services and facilities. Factor 6 It also can be deduced, using the legal principle of res judicata, that the area that will be served by the proposed TPOSTCDD, after contraction, still will be amenable to separate special-district government. The Recommended Order and Report in DOAH Case Number 89-3654 found that the existing TPOSTCDD would be amenable to separate special-district government. Since the evidence in this case was that contraction will have no adverse impact on this issue, it can be concluded that the proposed TPOSTCDD, after contraction, still will be amenable to separate special-district government. REPORT AND CONCLUSIONS SUBMITTED this 29th day of January, 1997, at Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 29th day of January, 1997. APPENDICES APPENDIX A In accordance with F.A.C. Rule 42-1.013(1) and (4), the following is a list of the names and addresses of the witnesses and the findings which their testimony helped support: L.A. “Art” Woodworth, Jr. President, Florida Technical Services Nicholas Pointe Office Park 522 West Bearss Avenue Tampa, Florida 33613 Findings 3-6, 8, 15-18 Susan Johnson DRI and Subdivision Coordinator City of Tampa Tampa, Florida Findings 14, 15, 16 William J. Rizzetta Rizzetta & Company 3550 BuschWood Park Drive, Suite 135 Tampa, Florida 33618 Findings 5-6, 10-13, 15-18 Charles E. Cook, P.E. Vice-President, Land Division Lennar Homes, Inc. 1110 Douglas Avenue, Suite 2040 Altamonte Springs, Florida 32714 Findings 3,6, 9 APPENDIX B In accordance with F.A.C. Rule 42-1.013(2), the following is a list of the attached documentary evidence: Petitioner’s Exhibit 1 - Receipt from “Florida Administrative Weekly” and Affidavit from “The Tampa Tribune” Petitioner’s Exhibit 2 - Resume’ of L.A. “Art” Woodworth, Jr. Petitioner’s Exhibit 3 - Area Map Petitioner’s Exhibit 4 - Letter from Susan Johnson Petitioner’s Exhibit 5 - Company Profile, Rizzetta & Company, March, 1996 Petitioner’s Exhibit 6 - Economic Impact Statement COPIES FURNISHED: Bob Bradley, Secretary Florida Land & Water Adjudicatory Commission Exec. Office of the Governor 1601 Capitol Tallahassee, FL 32399 Gregory Smith, Esquire Florida Land & Water Adjudicatory Commission Exec. Office of the Governor 209 Capitol Tallahassee, FL 32399-0001 Scott I. Steady, Esquire Williams Reed Weinstein Schifino & Mangione, P.A. Post Office Box 380 Tampa, FL 33602
The Issue Whether Respondent Southeast Grove Management, Inc., is indebted to Petitioner in the amount of $39,167.58 for mangoes grown by Petitioner and picked and sold by Respondent southeast
Findings Of Fact Petitioner Marcus D. Alston d/b/a Alston Groves is a grower of mangoes in Goulds, Florida. Respondent Southeast Grove Management, Inc., (hereinafter "Southeast") goes to individual groves and picks the mangoes, then takes them to the packing house where they are graded, sized, and shipped to be sold at prices according to size. When the recipient of the mangoes pays Southeast after receipt of the mangoes, Southeast ascertain's what prices were paid for the mangoes and then calculates its costs and pays the grower the difference. Between June 24 and August 9, 1988, Southeast sold 3,861.2 bushels of mangoes grown by Petitioner. There is no dispute as to the number of bushels of Petitioner's mangoes sold by Southeast. Petitioner disputes Southeast's calculations as to the price which Southeast received for the mangoes, the percentage of the mangoes sold by Southeast which "graded out" for sale, and the amount of picking and inspection fees charged by Southeast. Although Petitioner claims he had a verbal contract whereby Southeast agreed to pay him a flat rate of $20 per bushel minus picking charges, his Complaint seeks payment based on prices ranging from $6 to $20 per bushel which he also alleges were the market prices quoted to him by Southeast. At final hearing, Petitioner took the position that he is not seeking reimbursement of $20 per bushel but for only the lesser per bushel prices. No competent, substantial evidence was offered to prove that the prices Southeast received for the mangoes were higher than those reflected in Southeast's records. Petitioner claims that 100% of each picking was high quality, saleable fruit. No competent, substantial evidence was offered to justify Petitioner's selection of 100% for all pickings. The 100% figure selected by Petitioner allows for no differences in the amount of marketable mangoes from each picking, and there is no evidence to support the proposition that no matter when during the season the mangoes were picked exactly 100% of them were marketable as top grade mangoes. Further, during final hearing, Petitioner testified regarding his low cull rate, thereby admitting he knew that his mangoes were not 100% marketable. Although Southeast's records erroneously reflect inspection fees paid by Southeast to be deducted by Southeast from the sale price of the mangoes, no inspection fees were actually paid by Southeast, and Southeast has not deducted any inspection fees from Petitioner's account in calculating the net amounts to be paid to Petitioner by Southeast. The parties have stipulated that Southeast is not entitled to deduct picking fees for those batches of mangoes which Petitioner picked himself and delivered to Southeast. Southeast's records reflect that no picking fees were charged to Petitioner for the mangoes grown by Petitioner and sold by Southeast relating to 19 of the 48 tickets at issue in this proceeding. As to the mangoes reflected in 13 additional tickets, at the conclusion of the final hearing the parties requested and were afforded additional time to jointly review the actual picking tickets (not offered in evidence) for the name of the picker on each ticket to ascertain if the picker was a member of Petitioner's crew, thereby entitling Southeast to no picking fee, or a member of Southeast's crew, thereby entitling Southeast to collect a picking fee. The parties were to then file a statement regarding which additional batches of mangoes were picked by Petitioner's own employees. The parties have failed to do so, and Petitioner offered no evidence regarding this point on which a Finding of Fact can be made. Southeast's accounting sheet contains a column entitled "Net Actual" which sets forth the figures Southeast claims it owes Petitioner for the mangoes represented by each picking ticket. The total for that column equals $35,874.68, the total figure which Southeast claims it owes Petitioner. Southeast has paid Petitioner a total of $28,888.51 for his mangoes. Therefore, Southeast owes Petitioner the additional amount of $6,986.17.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, therefore, RECOMMENDED that a Final Order be entered finding that Southeast Grove Management, Inc., is indebted to Petitioner Marcus D. Alston d/b/a Alston Groves in the amount of $6,986.17 and that such monies should be paid to him within fifteen days from the entry of the Final Order. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 31 day of January, 1990. LINDA M. RIGOT 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 31 day of January, 1990. COPIES FURNISHED: Cliff Willis Florida Farm Bureau Mutual Insurance Company 1850 Old Dixie Highway Homestead, Florida 33033 Don Reynolds c/o Aaron Thomas, Inc. 11010 North Kendall Drive, Suite 200 Miami, Florida 33176 Marcus D. Alston Alston Groves 14100 Southwest 232nd Street Goulds, Florida 33110 Clinton H. Coulter, Jr., Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, Florida 32399-0800 Benjamin S. Schwartz, Esquire #1 CenTrust Financial Center 36th Floor 100 Southeast 2nd Street Miami, Florida 33131 Honorable Doyle Conner Commissioner of Agriculture Department of Agriculture and Consumer Services The Capitol Tallahassee, Florida 32399-0810 Mallory Horne, General Counsel Department of Agriculture and Consumer Services 515 Mayo Building Tallahassee, Florida 32399-0800 Ben Pridgeon, Chief Bureau of Licensing & Bond Department of Agriculture and Consumer Services 508 Mayo Building Tallahassee, Florida 32399-0800 =================================================================
