The Issue Whether or not the Respondent, State of Florida, Department of Revenue, is entitled to documentary stamp tax in accordance with Section 201.02, Florida Statutes, in the amount of $1,450.50 and a penalty in the amount of $1,450.50 under Section 201.17, Florida Statutes; and documentary surtax under Section , Florida Statutes, in the amount of $531.85 and penalties thereon in the amount of $531.85, pursuant to Section 201.17, Florida Statutes; as entered by the Respondent, State of Florida, Department of Revenue, on a transaction between Petitioners and Stam-Mil, Inc., are proper.
Findings Of Fact The Petitioners were the stockholders of Gallagher's of Miami, Inc. Among the assets of Gallagher's of Miami, Inc., were the rights under a sublease undertaken between B.G.L. Corporation and Gallagher's of Miami, Inc. dated September 25, 1976 and recorded in Official Record Book 5663, at page 261 of the Public Records of Dade County, Florida. This sublease was an amendment to a sublease which was dated June 1, 1965, recorded in Official Record Book 5768, Page 176 of the Public Records of Dade County, Florida, between B.G.L. Corporation, a Florida corporation as lessor, and KSJ Corporation, a Florida corporation as lessee. One of the conditions of Gallagher's lease obligation was responsibility for the payment of a mortgage dated May 1, 1965, recorded in Official Record Book 4592, at Page 161, of the Public Records of Dade County, Florida, from KSJ Corporation, a Florida corporation to Joseph Z. Lipsky and Evalyn Lipsky, as amended by agreement dated August 30, l65 between KSJ Corporation and Joseph Z. Lipsky and Evalyn Lipsky. Pursuant to a plan of liquidation of Gallagher's of Miami, Inc. that corporation executed and delivered to Petitioners an assignment of the lessee's interest in the aforementioned lease to which Gallagher's of Miami, Inc. was a party. The assignment of lease can be found as Exhibit A to the petition filed by the Petitioners. The contents of such assignment are found to be fact. By letters of July 30, 1975 and March 10, 1975, the Respondent indicated its intention to assess tax in the amount of $326.10 upon the document representing the assignment between Gallagher's of Miami, Inc. and the Petitioners. The amount of documentary stamp tax was premised on the aforementioned mortgage which at the time of the proposed assessment was valued at $108,750. In addition the Respondent indicated its intention to impose a penalty in a like amount of $326.10. The assignment was in fact executed, pursuant to a plan of liquidation, which plan is shown as Petitioner's Exhibit C attached to the petition. The Petitioners' Exhibit C is established as fact. Petitioners in receiving the assignment in liquidation Gallagher's of Miami, Inc. received such assignment in proportion to their stock holdings in that corporation. Subsequent to the assignment of leases and agreement between Gallagher's of Miami, Inc. and the Petitioners a further assignment was made between the Petitioners and Stan-Mil, Inc. of the same property, which took place on December 16, 1974. The Petitioners executed and delivered to Stan-Mil, Inc. a Florida corporation, the assignment of lease of lessee's interest in a lease, as shown in Petitioner's Exhibit A attached to its petition challenging the assessment in the transfer of Petitioners' interest to Stan-Mil, Inc. The facts of Exhibit A are admitted. The assignment was excluded pursuant to an agreement for the sale of a restaurant (Gallagher's Restaurant) , the lease assignment being of the assets of the restaurant which was sold. A copy of the closing statement, upon the sale of the restaurant, a copy of the bill of sale of all assets sold and a copy of an appraisal report allocating the purchase price for the restaurant, among all of the assets sold is attached as Petitioner's Exhibit D to the petition challenging the assessment on the transaction between the Petitioners and Stan-Mil, Inc. The facts of Exhibit D are admitted. The Respondent, through its letter of March 8, 1976, proposes to assess documentary stamp tax under 201.02 F.S. in the amount of $1450.50 and a penalty in like amount under 201.17 P.S. In addition the letter notices a proposed assessment of documentary surtax under 201.021 F.S. in the amount of $531.85 and a penalty of $531.85 pursuant to 201.17 F.S. These amounts represent the tax on the appraised value of the lease-land and building in the amount of $83,500.00 and the leasehold improvements in the amount of $400,000.00. These lease-hold improvements are to be distinguished from such tangible items as furniture, fixtures, equipment, dishes and silverware, which were separately appraised in the valuation of the assets of the restaurant, known as Gallagher's of Miami, Inc. The Petitioners are challenging the proposed assessment of tax on the transaction between the Petitioners and Stan-Mil, Inc.
Recommendation It is recommended that the documentary stamp tax in the amount of $1450.50 and a like penalty of $1450.50, and the documentary surtax in the amount of $531.85 and a like penalty of $531.85, as assessed against the Petitioners, be upheld. DONE and ENTERED this 28th day of February, 1977, in Tallahassee, Florida. CHARLES C. ADAMS, Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Lewis M. Kanner, Esquire 1003 DuPont Building 169 E. Flagler Street Miami, Florida 33131 Caroline E. Mueller, Esquire Assistant Attorney General The Capitol Tallahassee, Florida 32304 ================================================================= AGENCY FINAL ORDER =================================================================
The Issue Whether the Department of Transportation's intended action to reject all quotes and re-advertise Lease No. 550:0318 was illegal, arbitrary, fraudulent, or dishonest.
Findings Of Fact In October of 1999, the Department advertised for office space for use as the Toll Data Center - Audit Section, Office of Toll Operations (Toll Office) located in Broward County. The lease was clearly advertised as a negotiated lease. It was not advertised as a competitive bid lease. Under the negotiated lease process before letting any lease, the Department must submit to the Department of Management Services (DMS) a Request for Space Need (RSN) and Letter of Agency Staffing (LAS). From DMS the Department receives the authority to directly negotiate a lease for space under 5,000 square feet with prospective lessors. 1/ Consistent with procedure, the Department received approval of the RSN on October 18, 1999. Pursuant to statute, DMS has strongly suggested that prior to selection of the apparent successful lessor, the Department should obtain a minimum of three documented quotes for a lease that has not been competitively bid. The Department has consistently followed that suggestion in negotiated leases. Under special circumstances, where it is clear it is improbable that three quotes cannot be obtained, the Department may waive its requirement that three documented quotes be received. However, the agency must certify to DMS that attempts to receive the required number of documented quotes were unsuccessful and/or special circumstances exist to negotiate the lease with less than three quotes. In this case, no special circumstances exist. In an effort to obtain more than the minimum three documented quotes, the Department opted to advertise for lease space on the Internet. The Internet is utilized by the DMS, among other state agencies, to disseminate information provided in the RSN to the private sector. Additionally, the Internet site may also be used by the private sector to provide notice of space they have available for review by the agency seeking space. A total of three submittal packages were distributed for Lease No. 550:0318. Despite the Department's advertisement over the Internet, only two requests for quote submittal packages were received. Of the three quote submittal packages distributed, the Department received only one documented quote in response to the advertisement for the Toll Office. Atlantic Investment submitted a Quote Submittal Form to the Department in late October for office space in North Fort Lauderdale. Atlantic Investment became aware of the Department's advertisement for lease space from Sheldon M. Schermer, employed by Atlantic Investment as its real estate agent. Mr. Schermer learned of the Department's need for lease space from an advertisement placed on the Internet. On November 8, 1999, the Department informed Atlantic Investment via Sheldon M. Schermer, Real Estate Agent for Atlantic Investment, of the Department's intent to reject all quotes and re-advertise for Lease No. 550:0318. This decision was not arbitrary, capricious, fraudulent, or dishonest and well within the Department's discretion and procedures for negotiated leases. The basis for the decision was the Department's modification of the lease specifications pursuant to a recommendation by DMS to modify the lease space terms to hopefully generate more interest and more quotes. In a competitive negotiation, DMS was aware of agencies who modified leases and advertised as many as five times before three documented quotes were received. Moreover, the evidence showed that the Broward County commercial real estate market could easily generate three quotes for the space required by the Toll Office.
Recommendation Based upon the findings of fact and conclusions of law, it is RECOMMENDED: That a final order be entered dismissing the Petitioner's protest. DONE AND ENTERED this 14th day of April, 2000, in Tallahassee, Leon County, Florida. DIANE CLEAVINGER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 14th day of April, 2000.
Findings Of Fact Children's Medical Services (CMS) is a statewide program of the Department of Health and Rehabilitative Services which provides services for children who are suffering from medically debilitating or potentially medically debilitating conditions of a chronic nature. In Broward County, Respondent, District X of the Department of Health and Rehabilitative Services (District X), provides CMS services to approximately 4,000 children. The CMS Broward County Clinic is currently located in a leased facility. The lease expires in August, 1995. In the fall of 1994, District X determined that it would seek to lease a larger facility in the private sector to replace the existing leased facility. In November, 1993, Christopher Edghill, who was then the Facilities Manager for District X, prepared a Request for Prior Approval of Space (RNS), seeking approval from the Department of Management Services (DMS) for a new lease to house the CMS program in District X. The RNS stated that District X desired to enter into a ten-year turnkey lease for 19,233 square feet. District X desired to acquire the facility in the private sector through a competitive bidding process. The RNS also included a Letter of Agency Staffing as justification for the space requested and a certification that the district had sufficient funds available to pay for the leased space. Prior to submitting the RNS to DMS, Mr. Edghill did not inquire whether there was public space available in Broward County which would be suitable for housing the CMS program, and no evidence was presented to show that public space was available at that time. After submission of the RNS, District X amended the RNS to include an option to renew. The RNS was approved by DMS on December 3, 1993. In January, 1994, District X issued the solicitation document for bids for lease for CMS facility. The lease number assigned was 590:2490. A pre-bid conference was held on February 10, 1994. James F. Antonucci, a representative for Petitioner, Gulf Properties, Inc. (Gulf), attended the pre-bid conference. On April 4, 1994, Dr. Joni Letterman, who is the Medical Director of CMS for District X, was approached by Linda Bouffard and Rita Frantz concerning a needs assessment for a children's medical center in conjunction with North Broward Hospital District (NBHD). At that time the children's center was in its very early planning stages. The children's center was envisioned to be a combined maternal, obstetrical, pediatric, neonatal and full service children's hospital center with inpatient and outpatient services. On April 6, 1994, Gulf entered into an option agreement to purchase land for space to be utilized for Lease No. 590:2490 should Gulf be awarded the contract. Gulf and ANF Real Estate Group, Inc. (ANF) timely submitted responses to the solicitation by District X. The bids were opened on April 7, 1994. Gulf submitted one bid and ANF submitted two bids. Gulf's bid offered a full service lease at $16.79 per square foot for the first year for 19,800 square feet, plus or minus three percent. A bid evaluation committee of five (5) members was selected by District X. One of the evaluation committee members was Dr. Letterman. On April 20, 1994, the evaluation committee visited the sites proposed by the bidders. By letter dated April 22, 1994, Dr. Letterman notified Ms. Frantz and Ms. Bouffard that CMS was in the process of selecting a bidder for a ten year lease and that relocation of CMS as part of the children's center would not be possible. Sometime in late April or early May, 1994, Dr. Letterman was asked to join the Children's Initiative Committee, which was formed to expand on the concept of the children's center. Dr. Letterman attended her first committee meeting in early May, 1994. At that meeting the committee asked Dr. Letterman where CMS could fit into the children's center concept. Dr. Letterman explained that District X was in the midst of a competitive procurement process for a new CMS facility and did not know whether CMS could commit to relocating on the campus of Broward General Medical Center (BGMC). Mr. Will Trower, Chief Officer of BGMC, was present during the meeting but did not offer any space at that time relating to CMS for use while the children's center was being developed. By memorandum dated May 27, 1994, the evaluation committee notified the acting district administrator that Gulf received the highest rating and recommended that the lease be awarded to Gulf. By letter dated June 9, 1994, Dr. Letterman wrote to Mr. Trower, stating: For CMS to move forward toward the Children's Center concept and reject bids already submitted, the Department requires a written letter of commitment assuring CMS space and related needs will be met as well as a provision for an interim CMS site as of September 1, 1995, the date our current lease expires. Due to constraints related to the bid process, I must have this written confirmation by the close of business, Thursday, July 16, 1994. By letter dated June 13, 1994, Dr. Letterman advised Mr. Trower that the deadline for response was incorrect in her June 9, 1994 letter and should have read June 16, 1994. Mr. Trower responded by letter dated June 16, 1994, wherein he advised: As it relates to interim space for CMS, I can at this time commit to offering to meet with you to have you consider space that will be available this spring in our medical office tower adjacent to the hospital. Based on our previous discussion, I believe this space will be adequate in size and capability for an interim location of the CMS services. A lease agreement could be established which would meet your needs for relocation and provide an interim location until such time as the Children's Center is completed. BGMC offered a full service lease of 16,950 square feet for $14.50 per square foot. By memorandum dated June 20, 1994, Mr. Edghill recommended that the best decision would be to award the lease to Gulf. This recommendation was based on Trower's letter which indicated that the Board of Commissioners would have to approve the initiative to develop the children's center, on the effect that a delay could have regarding the bidders' options on the proposed sites, and on the likelihood of a protest by the bidders. By letter dated June 24, 1994, District X advised the bidders that authorization had been granted to award the lease to Gulf. A letter of intent to protest the award was timely filed by ANF on June 27, 1994, followed by a timely filed formal protest on July 9, 1994. On June 30, 1994, Gulf entered into an Agreement for Purchase and Sale of the property which was the subject of the April 6, 1994, option agreement. By memorandum dated August 17, 1994, the District X administrator advised James Towey, the Secretary of HRS, of possible options for resolving the CMS lease problem. Option I was to proceed with the competitive bid process through resolution of the ANF protest and sign a contract with Gulf Real Properties. Option 2 was to terminate the competitive bid process, request proposals from the North and South Broward Hospital Districts and award CMS lease space according to revised criteria. Option 3 was to award the lease to Gulf but alter the occupancy plan by replacing clinic-specific space with general office space and relocating other District programs to the site. The District would then award the clinic-specific space to a hospital entity. On August 26, 1994, ANF filed a Notice of Withdrawal of Formal Written Protest, advising District X that ANF was abandoning its requests for agency action regarding Lease No. 590:2490. On August 26, 1994, Gulf entered into an addendum to the purchase and sale agreement, whereby it was acknowledged that a protest had been filed by ANF concerning the bid award for the lease of the facility which Gulf intended to construct on the property and it was agreed that Gulf had until September 30, 1994, to resolve the protest and that if the protest was not resolved in favor of Gulf that Gulf could cancel the contract. By memorandum dated August 29, 1994, Secretary Towey advised the District X administrator to follow Option 2. His decision was based on his understanding that the District had incorrectly considered North Broward Hospital ("BGMC") not to be a governmental entity when it made its initial decision to award to Gulf and the move to North Broward Hospital would be in the best interests of their clients. By letter dated August 31, 1994, District X advised Gulf that ANF had withdrawn its protest and that District X was rejecting all bids because suitable space had been made available by governmental entities. The letter advised Gulf that it could request an administrative hearing within 30 days of receipt of the letter. The governmental entities referred to in the August 31, 1994 letter were North Broward Hospital and South Broward Hospital. At the end of June, 1994, Dr. Letterman toured the BGMC office space. She determined that the space offered by BGMC was adequate to meet the needs of the District for the CMS clinic. A large number of CMS' clients are located near the hospital. Co-location of CMS at BGMC would allow the sharing of certain areas such as the employee lounge, the medical library, and medical record storage, thus reducing the space that would be required for the CMS program. Additionally, CMS employees, such as economic eligibility employees could be outposted at the hospital, thereby eliminating office space at CMS. Currently BGMC provides services to the CMS clinic such as x-ray, laboratory, diagnostic, hearing testing, and sleep studies. Co-location of CMS and BGMC would eliminate the need to shuttle clients back and forth between the clinic and the hospital and thereby reduce the stress on the childrens' families and provide more efficient services. For example, co-location would eliminate the need for a child who was going to have outpatient surgery of having to go to the clinic for a pre-op exam, travel to another location for laboratory work, and then go to a different location for the surgery. Through co-location the services could be provided in one visit at one location. Co-location of CMS with BGMC should result in more efficient use of the physicians' time. For example the doctors would not have to travel back and forth from the clinic to the hospital. Patient records would be more accessible for use by the physicians because the records could be maintained in one location. In reviewing the proposals submitted by Gulf and ANF, Dr. Letterman had been concerned about the location of an emergency room near the proposed locations. The co-location of CMS and BGMC would result in an emergency room in a CMS approved hospital being in close proximity to the clinic. On August 31, 1994, Gulf sent a termination letter to the seller of the property, advising that District X had rejected all bids. Gulf and the seller of the property thereafter executed another addendum to the purchase contract effective September 15, 1994, which allowed the withdrawal of the termination letter and provided that the closing should take place no later than May 31, 1995. Gulf timely filed its Petition for Administrative Hearing on September 30, 1994. In 1975, DMS, formerly the Department of General Services, promulgated what is now numbered as Rule 60H-1.017, Florida Administrative Code. This rule deals with turnkey leases. The rule was amended once in 1986. Sometime during 1976 or 1977, management at DMS, relying on advice from legal counsel, determined that it did not have the authority to participate in the evaluation of proposals for turnkey leases of user agencies and decided to ignore Rule 60H-1.017, formerly Rule 13M-1.017. DMS did not repeal the rule and amended the rule in 1986. The DMS real property leasing manual as revised in 1986 contained the procedures for the procurement of turnkey leases as set forth in Rule 60H-1.017. In 1979, HRS promulgated Rule 10-8.007, Florida Administrative Code, dealing with turnkey leases. The rule has not been amended since its adoption. In 1993 or 1994, the Division of Facilities Management of DMS, loaned a staff person to HRS to assist in the revision of HRS Manual, Facilities Acquisition and Management, Procuring Leased Space. This manual provides that for the procurement of turnkey lease construction the District should refer to Section 60H-1.017, Florida Administrative Code, and the Department of Management Services' Real Property Lease Manual and consult with the office of general services of HRS. District X has not made a recommendation to DMS for the proposed award of the lease in issue. The Division of Facilities Management has not made an evaluation of the proposals. There has been no joint approval by the Department of Management Services and District X on the proposal submitted by Gulf Properties. Although Rules 60H-1.017 and 10.8.007 are still in existence, HRS has been following the procedures set forth in Rule 60H-1.015 at least since 1983. Essentially, HRS determines whether there is existing space available and requests approval from DMS to seek a turnkey lease if there is no existing space available. If DMS approves HRS to seek a turnkey lease, HRS advertises for proposals, reviews the proposals submitted, gives notice of an intended award, and sends documentation to DMS in order that DMS may review and approve the lease. In turnkey lease procurements, DMS has followed a procedure similar to that set forth in Rule 60H-1.015. DMS reviews the initial request from HRS to go out for a turnkey lease. If approved HRS proceeds to solicit and award a lease. DMS will give technical assistance to HRS during the procurment process if HRS requests. After HRS notifies the bidders of the intended award, it sends documentation to DMS for review and approval. DMS reviews the following things: floor plans and specifications; price; compliance of design with the standards of the Americans with Disabilities Act; appropriateness of the completion date of the project; availability of public transportation; parking facilities; and dining facilities as they relate to the turnkey lease location. If any of the criteria reviewed by DMS is inappropriate or fails to comply with the specifications or DMS standards, DMS will not let HRS go forward with the project until the deficiency is corrected. The bid solicitation document provides: Notification of bid award is final when either no protests are submitted or after all protests are resolved by an administrative hearing procedure. Subsequent protests at District Court level will not be grounds for delaying bid award. The solicitation document also states that HRS has the right to reject any and all bids.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered dismissing Gulf's bid protest and rejecting all bids for lease number 580:2490. DONE AND ENTERED this 15th day of August, 1995, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND 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 August, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-5628BID To comply with the requirements of Section 120.59(2), Florida Statutes (1993), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. Paragraph 1: Accepted in substance. Paragraphs 2-5: Rejected as unnecessary detail. Paragraph 6: Accepted in substance. Paragraph 7: Rejected as unnecessary detail. Paragraph 8: Accepted in substance. Paragraph 9: Rejected as unnecessary detail. Paragraphs 10-15: Accepted in substance. Paragraphs 16-17: Rejected as unnecessary detail. Paragraph 18: Accepted in substance. Paragraph 19: The portion of the paragraph stating that Gulf has maintained control of the subject property since the time of initial option is rejected as not supported by the greater weight of the evidence. The remainder of the paragraph is accepted in substance. Paragraphs 20-21: Accepted in substance. Paragraph 22: The first sentence is rejected as unnecessary detail. The second sentence is accepted in substance. Paragraphs 23-25: Accepted in substance. Paragraph 26: The portion of the sentence which states the ITB required that the award letter be issued within 30 days is rejected as not supported by the greater weight of the evidence. The remainder is accepted in substance. Paragraph 27: Rejected as immaterial. Paragraph 28: Accepted in substance. Paragraph 29: Rejected as immaterial. Paragraphs 30-31: Accepted in substance. Paragraphs 32-33: Rejected as immaterial. Paragraph 34: The portion that states the notice of withdrawal was filed on August 26 is accepted. The remainder is rejected as unnecessary detail. Paragraph 35: Accepted in substance. Paragraph 36: Accepted in substance to the extent that the manual refers to Rule 60H-1.017 F.A.C. for the procedures for turnkey leases. Paragraph 37: Rejected as immaterial. Paragraph 38: Accepted in substance to the extent that he did follow the manual but not to the extent that the manual set forth the procedures for procuring a turnkey lease. Paragraph 39: Rejected as not supported by the greater weight of the evidence and as contrary to law. Paragraphs 40-41: Rejected as unnecessary. 27 Paragraph 42: Accepted in substance. 28. Paragraphs 43-44: Rejected as unnecessary. Paragraph 45: Accepted in substance. Paragraphs 46-47: Rejected as unnecessary detail. Paragraph 48: Accepted in substance. Paragraph 49: Rejected to the extent that the only government entity interested in providing space was Broward General. Paragraphs 50-51: Rejected as unnecessary. Paragraphs 52: Rejected as subordinate to the facts found. Paragraphs 53-59: Accepted in substance. Paragraphs 60-68: Rejected as irrelevant. Paragraph 69: Rejected as not supported by the greater weight of the evidence. Paragraphs 70-71: Accepted in substance. Paragraphs 72: Rejected as irrelevant as to whether she was qualified as an expert. Paragraph 73: Rejected as unnecessary detail. Paragraph 74: Accepted in substance. Paragraphs 75-81: Rejected as subordinate to the facts found. Paragraph 82: The first half of the sentence is rejected as unnecessary detail. The remainder of the sentence is accepted in substance. Paragraphs 83-90: Rejected as subordinate to the facts found. Paragraph 91: Rejected as constituting argument. Paragraphs 92-96: Rejected as subordinate to the facts found. Paragraph 97: Accepted as that has been the practice of HRS but rejected to the extent that it reflects what is required by Rule 60H-1.017. Paragraph 98: Rejected as not supported by the greater weight of the evidence and by the law. Paragraph 99: Rejected to the extent that it implies that DMS approval only means that the lease is effective for payment. Approval by DMS is required for a turnkey lease before the lease can be executed by the parties. Paragraph 100: Accepted to the extent that it means that DMS has not evaluated and given approval of the award. Supplement to Proposed Recommended Order Paragraphs 1-2: Rejected as unnecessary. Paragraph 3: Accepted in substance. Paragraph 4: Accepted in substance to the extent that HRS had the authority if it followed the procedures under 60H-1.017, and to the extent that the leases were eventually approved by DMS, HRS's premature notices of award were ratified. Paragraph 5: Accepted to the extent that it applies to the time periods before HRS issued a notice of award. Paragraph 6: Accepted in substance. Paragraphs 7-8: Rejected as unnecessary. Paragraph 9: The first sentence is accepted in substance as it pertains prior to HRS issuing a notice of award. It is clear that DMS did do some evaluation of the proposed awardee's proposal prior to DMS approving the lease. The second sentence is accepted in substance as to what actually happened but rejected as to what was stated in Rule 10-8.007 and HRS's interpretation as set forth in its leasing manual. Paragraphs 10-12: Accepted in substance. Paragraph 13: Accepted in substance to the extent that it refers to the time prior to an agency issuing a notice of intended award. Paragraphs 14-15: Accepted in substance. Paragraph 16: Accepted in substance to the extent that the procedures were consistent but that the procedures repudiated the procedures set forth in DMS's duly promulgated Rule 60H-1.017. Paragraph 17: Accepted in substance. Paragraph 18: Rejected as constituting a conclusion of law. Paragraph 19: Rejected as not supported by the greater weight of the evidence. Paragraph 20: Rejected as constituting a conclusion of law. Paragraph 21: Accepted to the extent that the District Administrator has authority to award when the appropriate rules have been followed. Paragraphs 22-23: Accepted in substance. Paragraph 24: Irrelevant since her current duties do not include procurement of turnkey leases and in the past she did not participate in the procurement of a turnkey lease. Paragraph 25: Accepted in substance. Respondent's Proposed Findings of Fact. Paragraphs 1-4: Accepted in substance. Paragraph 5: The first sentence is accepted in substance. The remainder is rejected as unnecessary detail. Paragraphs 6-9: Accepted in substance. Paragraphs 10-11: Rejected as subordinate to the facts found. Paragraph 12: The paragraph is accepted in substance as it relates to state-owned facilities but not as it relates to other governmental facilities. Paragraphs 13-14: Accepted in substance. Paragraph 15: Rejected as unnecessary detail. Paragraphs 16-17: Rejected as immaterial to the facts actually found. Paragraphs 18-19: Rejected as unnecessary detail. Paragraphs 20-51: Accepted in substance. Paragraph 52: Rejected to the extent that it implies that for this particular case it was the sole responsibility of District X to evaluate the proposals. Paragraphs 53: Rejected as unnecessary detail. Paragraphs 54-55: Accepted in substance. Paragraph 56: Rejected as immaterial. Paragraph 57: Accepted in substance. Paragraphs 58-59: Rejected as immaterial. Paragraph 60: Accepted in substance. Paragraph 61: Accepted in substance except as to the statement the pressure was passed on, which is rejected as not supported by competent substantial evidence. Paragraphs 62-66: Accepted in substance. Paragraph 67: Accepted in substance except as to the date. The notice was faxed to the District on August 26 and a hard copy was submitted on August 29. Paragraph 68: Rejected as not supported by the evidence. 23 Paragraph 69: Accepted in substance. Paragraph 70: Rejected as unnecessary. Paragraph 71: Accepted in substance. Paragraph 72: Rejected as constituting a conclusion of law. Paragraph 73: Rejected as unnecessary. Supplemental Proposed Findings of Fact Paragraphs 1-2: Accepted in substance. Paragraph 3: Accepted in substance to the extent that the evaluation by DMS and the user agency is not done simultaneously. Paragraphs 4-9: Accepted in substance. Paragraph 10: Accepted to the extent that in actual practice DMS assists when requested by the user agency prior to the issuance of the notice of award. Paragraphs 11-19: Accepted in substance. COPIES FURNISHED: Kim Tendrich, Esquire District 10 Legal Counsel Department of Health and Rehabilitative Services 201 West Broward Boulevard Suite 513 Fort Lauderdale, Florida 33301 William A. Frieder, Esquire Assistant General Counsel Building E, Suite 200 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Wilbur E. Brewton, Esquire I. Ed Pantaleon, Esquire Taylor, Brion, Buker & Greene 225 South Adams, Suite 250 Tallahassee, Florida 32301 Robert L. Powell, Agency Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Kim Tucker General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
Findings Of Fact At all times relevant hereto, Virginia King was registered with the Florida Real Estate Commission as a real estate salesperson. She has been so licensed for at least 15 years working for Tam Bay Realty. Respondent manages the residential unit here involved for the owners to whom she has sold several properties in past years and who have been out of the country for an extended period. In renting the property the rent is paid to Respondent, deposited into her account from which various expenses associated with the rental of the property is paid, and she makes an accounting to the owners for all monies owed to them. The dwelling in question was listed with Tam Bay Realty for sale with Respondent as listing agent, but she was also renting the property on behalf of the owner. To the Tam Bay For Sale sign on the property, Respondent attached a For Rent sign. Richard D. and Linda Grey were looking for a rental and saw the For Rent sign on the property and called Tam Bay Realty where they were put in touch with Respondent who subsequently met the Greys at the residence. The Greys liked the property and gave Respondent a check for $100 as a deposit on the lease to be executed when the Grey's presented their first month's rent. The residence needed some cleaning which Respondent agreed to have done if the Grey's would have the water turned on. Grey also wanted some trimming of hedges to which Respondent agreed. The Greys later met Respondent at the dwelling before the cleaning and trimming had been done. Grey contends that he did not have the water turned on because "that was the owner's responsibility," but the water was turned on and Respondent had the dwelling cleaned and the hedges trimmed for which she paid in excess of $100. Before the time for occupancy arrived, the Greys encountered a delay in the closing on the home they were selling and called Respondent to say they no longer wanted to rent the house and demanded a return of their $100 deposit. Respondent, contending that Grey breached the agreement to rent the property, credited the $100 to the account of the owner (whose account was also charged for the cleaning and trimming), and refused to remit the deposit to Grey.
The Issue Whether Respondent's license as a real estate salesman should be suspended or revoked, or the licensee otherwise disciplined, for alleged violation of Chapter 475, F.S., as set forth in Administrative Complaint dated September 2, 1981. At the commencement of the hearing, the parties stipulated to Paragraphs 2 and 3 of the Administrative Complaint. Although Paragraph 2 thereof indicates that Respondent is a registered real estate salesman, he testified without contradiction that he has been licensed as a broker for the past 3-1/2 years. Accordingly, that fact will be reflected in the Findings of Fact herein. Both parties called one witness each to testify at the hearing, and Respondent testified in his own behalf. No exhibits were submitted in evidence.
Findings Of Fact Respondent, John M. Bosko, of Tampa, Florida, is a registered real estate broker and was so registered at all times relevant to the matters pertinent to this proceeding. (Testimony of Respondent, Stipulation) On or about May 11, 1979, Respondent leased a house which he owned at 3105 South Adams Street, Tampa, Florida, for a term of one year, to Gregory and Cindy Morrison. The lease was payable in the amount of $265.00 per month, and a $265.00 security deposit, to ensure compliance with performance of the lease provisions, was paid at the commencement of the lease. (Testimony of G. Morrison, Respondent, Stipulation) Gregory Morrison occupied the leased premises commencing in May, 1979. His wife, Cindy, left the house in December, 1979, and the couple was divorced in January, 1980. Mrs. Morrison took most of the furniture with her upon her departure. About March 1980, Respondent advised Morrison that he intended to sell the house and would not be renewing the lease. Morrison told him than he would leave the premises at the termination of the lease, on May 10, 1980. (Testimony of G. Morrison, Respondent) During the first week of April, 1980, Morrison moved to his future place of residence and did not live any longer in the leased house. During this period there was no furniture in the house. As to those articles that remained on the premises, the testimony of Morrison and Respondent is conflicting. Morrison claimed that he left a "pile of stuff" in the living room, including cleaning items, a vacuum cleaner, and games. He also testified that he had stored power tools, a weight bench, weights, a tuxedo, and a trombone in the garage. However, Respondent took a prospective purchaser of the house to the premises at approximately this time and they observed only an old vacuum cleaner in the living room. There were no clothes in the closets, no food in the refrigerator, and only some debris in the corner of the closets. About 500 whiskey bottles were distributed throughout the house, and about 35 marijuana plants were located in the family room. Respondent testified that he saw nothing in the garage. He therefore hired someone to clean the premises and put any of Morrison's items in the garage. Respondent was of the opinion that the house had been abandoned and that Morrison had forfeited the security deposit. (Testimony of G. Morrison, Respondent, Bankston) Morrison went to the house some time thereafter, saw that his property was missing, and reported it to the police. He telephoned the Respondent who informed him that he thought Morrison had vacated the premises, and that he had secured another tenant. Respondent told him that any of his property that had been left in the house could be found in the garage. Respondent declined to return the security deposit because he believed that Morrison had breached the provisions of the lease. Although Morrison had not paid the rent when due on April 1, he had a five-day grace period and tendered the month's rent to the Respondent within that time, but Respondent refused to accept it. Respondent proceeded to lease the property to another tenant and did not issue any notices to Morrison, or initiate any judicial proceedings pursuant to Chapter 83, Florida Statutes. Respondent testified that he was unaware of the provisions of Chapter 83. (Testimony of G. Morrison, Respondent) Morrison filed a civil action against Respondent for recovery of his personal property. The parties arrived at a compromise settlement consisting of return of Morrison's security deposit and one month's rent. (Testimony of G. Morrison)
Findings Of Fact Petitioner is a dealer in heavy construction equipment and has been since its incorporation on August 1, 1946. Among petitioner's competitors are Dewind Machinery Company, Florida Equipment Company of Jacksonville, Florida- Georgia Tractor Company, Inc., Great Southern Equipment Company, Inc., Pilot Equipment Company, Inc., Ring Power Corporation and Joseph L. Rozier Machinery Company. Like its competitors, petitioner frequently leases equipment to its customers, giving them an option to purchase, rather than selling them the equipment outright. Petitioner's exhibit No. 1 reflects one such transaction. On April 19, 1973, petitioner quoted Houdaille Duval Wright Company (Houdaille) a purchase price of twenty-two thousand dollars ($22,000.00) plus sale's tax, and monthly rent of fourteen hundred dollars ($1,400.00) plus sales tax on a diesel powered, self-propelled vibratory roller. After negotiations between petitioner and Houdaille, the purchase price dropped to seventeen thousand dollars ($17,000.00), but the monthly rental remained unchanged. Houdaille agreed to lease the vibratory roller from petitioner on these terms. With respect to its option to purchase, Houdaille specified that: 100 percent of all rentals to apply towards purchase price of $17,000.00 less 10 percent discount on remaining outstanding balance at time of purchase. Interest to accrue at a rate 7 1/2 percent simple. Houdaille made lease payments for nine months, totaling twelve thousand six hundred dollars ($12,600.00), before electing to exercise its option to purchase. In calculating the amount of money Houdaille was to pay to close out the transaction, petitioner began by treating the payments Houdaille had made under the lease as if they had been payments made in repayment of a loan, outstanding for the period of the lease, in the amount of seventeen thousand dollars ($17,000.00), at 7 1/2 percent per annum. Petitioner allocated portions of each lease payment to principal and to interest, calculated on the declining principal balance, aggregating eleven thousand nine hundred ten dollars and fifty-four cents ($11,910.54) to principal, and six hundred eighty-nine dollars and fourty-six cents ($689.46) to interest. Petitioner then calculated the 10 percent discount by multiplying one tenth times the difference between the original price ($17,000.00) and the amount aggregated to principal ($11,910.54), which yielded five hundred eight dollars and ninety-five cents ($508.95). This figure was subtracted from the original contract price ($17,000.00) to ascertain the' discounted price ($16,491.05) against which the lease payments were credited in their entirety ($12,600.00), yielding the figure three thousand eight hundred ninety-one dollars and five cents ($3,891.05), on which petitioner calculated 4 percent sales tax. In addition, petitioner required Houdaille, in exercising its option to purchase, to pay six hundred eighty-nine dollars and forty-six cents ($689.46), the aggregate amount of lease payments petitioner had allocated to interest. In every respect pertinent to the dispute between petitioner and respondent, this transaction between petitioner and Houdaille is typical of the transactions on which contested portions of the tax assessments were based. The same is true of petitioner's lease and sale of a truck crane to Poston Bridge & Iron, Inc. (Poston), the transaction reflected in exhibit No. 2 (although petitioner's agreement with Poston did not involve a discount.) The terms of the lease purchase agreement, as stated on respondent's exhibit No. 2, were: Option Price $124,855.00 with 100 percent of paid rentals to apply to purchase price less interest at 8.5 percent simple. After making lease payments totalling twenty-six thousand dollars ($26,000.00), Poston exercised its option to purchase. At this point the lease payments were recast as installment sales payments, portions being allocated to principal and interest accordingly. Respondent collected sales tax on the amount of money Poston paid in exchange for title, after electing to purchase, less the aggregate amount of lease payments petitioner had allocated to interest. Petitioner has been entering into lease purchase agreements of this kind with various customers since 1946 or 1947, and, when customers exercised purchase options, petitioner ordinarily calculated sales tax in the manner it employed in connection with the sale of the vibratory roller to Houdaille, and the truck crane to Poston. In at least one instance, however, petitioner calculated sales tax as 4 percent of all the money a customer, Misener Marine Construction, Inc., paid when exercising its option to purchase a truck crane, including portions of lease payments petitioner had allocated to interest. On the lease payments themselves, petitioner regularly collected 4 percent sales tax which it regularly remitted to respondent. For federal income tax purposes, petitioner treated payments from customers under a lease purchase agreement as lease payments for every tax year in which the option to purchase was not exercised. For the tax year in which the option to purchase was exercised, the lease payments were treated as payments under an installment sale contract, for federal income tax purposes. When respondent audited petitioner's rentals for the period May 1, 1970, to April 30, 1973, and earlier when respondent performed a general audit of petitioner's books for the period July 1, 1959, to February 28, 1962, no mention was mace of petitioner's sales tax treatment of lease purchase agreements under which lessees had exercised purchase options. Before the audit which eventuated in the assessments now in controversy, however, the auditors were given a copy of a letter from L. N. Hansen to Thomas D. Aitken dated December 9, 1974. Mr. Hansen was formerly director of respondent's sales and use tax division. In the fall of 1974, he was one of a group or "board" of respondent's employees who considered questions arising under the tax laws and formulated policy for respondent. His letter to Mr. Aitken, which came in evidence as, petitioner's exhibit No. 5, was written on behalf of respondent after its substance was discussed at a meeting of respondent's policy group. It pertains to lease purchase agreements entered into by Joseph L. Rozier Machinery Co. (Rozier). Mr. Hansen's letter stated that Rozier was "not correct in reducing the taxable sales price by the rental payments and thereafter adding an interest charge which, if it was incurred at all, was incurred prior to the time of sale." Petitioner's exhibit No. 5, p. 1. The foregoing findings of fact should be read in conjunction with the statement required by Stucky's of Eastman, Georgia vs. Department of Transportation, 340 So.2d 119 (Fla. 1st DCA 1976), which appears as an appendix to the order.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That respondent abandon the uncollected portions of its deficiency assessments. DONE and ENTERED this 31st day of August, 1977, in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 APPENDIX Petitioner's proposed findings of fact Nos. 1, 4-8, and 10 have been adopted, in substance, insofar as relevant. Petitioner's proposed finding of fact No. 2 is irrelevant insofar as it differs from petitioner's proposed finding of fact No. 7, and for that reason has not been adopted where it differs from petitioner's proposed finding of fact No. 7. Petitioner's proposed finding of fact No. 3 has not been adopted because it is not relevant. Petitioner's proposed finding of fact No. 9 has not been adopted because what motivated respondent's employees is not relevant and because it was not proven what would have happened "[b]ut for the Hansen letter." Petitioner's proposed findings of fact Nos. 11 and 12 have not been adopted because they are irrelevant. Petitioner's proposed finding of fact No. 13 has not been adopted as such because it is actually a proposed conclusion of law. The first paragraph of respondent's proposed findings of fact has been adopted, in substance, except that exercise of the purchase option may be said to relate back to the beginning of the contract. Significantly, respondent proposes as a finding of fact that the "amount termed 'Interest' . . . is payable for the use of the money during the rental/lease period." Paragraphs two through seven, nine and ten of respondent's proposed findings of fact have been adopted, in substance, insofar as relevant. The eighth paragraph of respondent's proposed findings of fact has not been adopted; it is actually a proposed conclusion of law. COPIES FURNISHED: Mr. Daniel S. Dearing, Esquire Post Office Box 1118 424 North Calhoun Street Tallahassee, Florida 32302 Ms. Patricia S. Turner, Esquire Assistant Attorney General Department of Legal Affairs The Capitol Tallahassee, Florida 32304
Findings Of Fact Respondent Shirley Holland was registered with Petitioner as a real estate salesman in January, 1976, associated with Vern Duncklee Real Estate and Insurance, Inc., Naples, Florida. He is presently registered as a real estate broker. (Stipulation) On January 5, 1976, W. H. Ragan gave the Duncklee firm a listing to sell real property consisting of approximately one and one-quarter acres located in Collier County, Florida, for a selling price of $7,500. Respondent was the listing salesman. (Testimony of Respondent, Ragan, Duncklee, Petitioner's Exhibit 6). Respondent also was a builder who operated as Holland Investment Company. It was his practice to purchase various properties, remodel existing structures on the same, and thereafter sell them at a profit. There was a two- room shed located on the Ragan property that had no inside finishing work, electricity, or septic tank. Respondent decided to take an option on the property in order to remodel it by adding a room and to place it in a habitable condition. He broached the subject to Ragan on January 6, 1976, and Ragan told him on January 7, that he was agreeable to such a contract. On January 8, Respondent and Ragan and his wife entered into a Sales Contract and Option to Buy for $7,500. The contract provided that closing would take place within twelve months and that the seller would give possession of the property to the purchaser on January 8, 1976. This was pursuant to an accompanying rental agreement dated January 8, 1976, between the parties for a period of twelve months which provided that Respondent could exercise his option at any time within the stated twelve-month period whereby all rents paid would be applied toward the down payment on the property of $1,900 which was to be made at closing of the sale. The rental agreement further provided that if Respondent did not exercise his option within the required time, any improvements made by him on the property during that period would be considered liquidated damages of the owner. Pursuant to these agreements, Respondent made a payment of $100 at the time they were executed, which represented an initial deposit on the contracts and as rent for first month of the term. The Option Agreement also gave Respondent authority to remodel the building on the property and it further reflected that Respondent was a registered real estate salesman and would be selling the property for profit. (Testimony of Respondent, Duncklee, Petitioner's Exhibits 5, 7) On January 5, 1976, Respondent showed Harold and Ruby Stacy several houses in the area that were for sale. On January 9, Respondent went by the Stacy residence to see if they were interested in any of the houses he had shown them. They were not interested in those houses and Respondent told them of property that he had recently acquired which was the Ragan property. He showed it to Mr. Stacy that night and the next day Mrs. Stacy went with him to look at the premises. During the course of their conversations, Respondent offered to rent the property to them for $100 for the period January 10 to February 1, 1976. It was his intention to rent it to them for $125 per month commencing in February on the condition that they clean and fix up the property. They also discussed the possibility of purchase at a later date. Respondent told them that he would sell to them for $13,000 if Harold Stacy would do the remodeling work on the shed with Respondent supplying the materials. Respondent quoted a possible sales price of $14,500 if he was obliged to provide both labor and materials for renovating the shed and providing for utility services. Respondent and the Stacys entered into a rental agreement on that day for the initial period of some three weeks and Ruby Stacy gave him a check dated January 10 for $100 with a notation thereon that it was a deposit on land. Respondent explained to Mrs. Stacy that he was merely renting the property at that time and added the word "rent" at the bottom of the check. (Testimony of Respondent, Petitioner's Exhibit 1, 2) Thereafter, the Stacys proceeded to clean the premises and commence installing a ceiling in the building located on the property. They also installed a septic tank. At some undisclosed date, Ragan came to the property to obtain some of his belongings and found the Stacys there. He learned that they supposedly had purchased the property from Respondent, Ragan was of the opinion that Respondent had purported to sell the property before he had obtained the option thereon and that he had therefore defrauded the Stacys. Ragan thereupon filed a complaint against Respondent with the local Board of Realtors in latter January, 1976. About the same time, Respondent had been in the process of obtaining local permits to install the septic tank and do the other work. He discovered that the Stacys had installed a septic tank without his authorization and without obtaining a permit. He thereupon, by letter of January 21, 1976, informed the Stacys that they had done work on the property without a building permit or approval of the County Health Department and therefore was refunding the rental payment of $100. He enclosed his check in that amount, dated January 21, 1976. Although Respondent later attempted to exercise his option to purchase the property, Ragan refused to fulfill the agreement and later sold the property to the Stacys himself for $7,500. (Testimony of Respondent, R. Stacy, Ragan, Petitioner's Exhibits 3,4) Mrs. Stacy testified at the hearing that she was under the impression that she and her husband had purchased the property in question on January 10, 1976, and that the $100 payment had been a deposit for such purchase. She was under the further impression that they were to make a $2,500 down payment in February to consummate the deal. She further testified that they made the improvements on the land because of their understanding that they were going to purchase it. Mrs. Stacy had never been involved in a prior purchase of real property and is unfamiliar with contract documents and terminology. It is found that Mrs. Stacy honestly believed that she and her husband had a valid agreement to purchase the property. Her testimony that she and her husband entered into the rental arrangement in January to enable them to work on the property until they could make the down payment in February is deemed credible. (Testimony of R. Stacy) Ragan and Respondent had been involved in a prior real estate transaction and Respondent testified that Ragan had not been satisfied with that transaction, but Ragan testified to the contrary. However, Ragan talked to Respondent's broker in January, 1976, about the Stacy situation, at which time Ragan stated that he had a chance to get even with Respondent for the prior transaction and that he was going to do so. (Testimony of Respondent, Ragan, Duncklee, D. Holland)
Recommendation That the Administrative complaint be dismissed. DONE and ENTERED this 8th day of March, 1979, in Tallahassee, Florida. THOMAS C. OLDHAM Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Joseph A. Doherty, Esquire Florida Real Estate Commission Post Office Box 1900 Orlando, Florida 32802 Ed R. Miller, Esquire Suite 212 - 1400 Gulf Shore Boulevard Naples, Florida 33940
