The Issue The issue for disposition in this case is whether Respondent has implemented an agency statement that meets the definition of a rule, but which has not been adopted pursuant to section 120.54, Florida Statutes.
Findings Of Fact The Board of Trustees of the Internal Improvement Trust Fund (Board) is charged with the management of state lands, including sovereign submerged lands. § 253.03(1), Fla. Stat. The Department of Environmental Protection (Department) is charged with the duty to “perform all staff duties and functions related to the acquisition, administration, and disposition of state lands, title to which is or will be vested in the Board of Trustees of the Internal Improvement Trust Fund.” § 253.002(1), Fla. Stat. The City of Titusville operates a municipal marina, which includes a 205-slip docking facility for mooring of commercial and recreational vessels (Marina), on sovereignty submerged lands leased from the Board. Petitioner owns a Florida-registered vessel which he keeps at the Marina pursuant to an annual mooring/dockage agreement. On June 9, 2009, the City of Titusville and the Board entered into a “fee waived” lease renewal and modification for a parcel of sovereignty submerged land in the Indian River (Lease). The Lease allows the Marina to operate “with liveaboards as defined in paragraph 26, as shown and conditioned in Attachment A, and the State of Florida Department of Environmental Protection, Consolidated Environmental Resource Permit No. 05-287409-001, dated December 31, 2008, incorporated herein and made a part of this lease by reference.” Paragraph 26 of the Lease provides that: 26. LIVEABOARDS: The term “liveaboard” is defined as a vessel docked at the facility and inhabited by a person or persons for any five (5) consecutive days or a total of ten (10) days within a thirty (30) day period. If liveaboards are authorized by paragraph one (1) of this lease, in no event shall such “liveaboard” status exceed six (6) months within any twelve (12) month period, nor shall any such vessel constitute a legal or primary residence. On or about July 31, 2015, Petitioner and the City of Titusville entered into the annual contractual mooring/dockage agreement, paragraph 4 of which provides that: 4. LIVEABOARDS: For the purposes of this Agreement, the term “liveaboard” is defined herein as a vessel docked at the facility and inhabited by a person or persons for any five (5) consecutive days or a total of ten (10) days within a thirty (30) day period. Pursuant to requirements of the City’s Submerged Land Lease with the State of Florida, no vessel shall occupy the Marina in this “1iveaboard” status for more than six (6) months within any twelve (l2) month period, nor shall the Marina Facility constitute a legal or primary residence of the OWNER. Petitioner asserts that the alleged agency statement regarding “liveaboard” vessels “unreasonably and arbitrarily denies me the unrestricted right to stay on my vessel by limiting the number of consecutive days during which I may occupy the vessel,” and that “[t]he Board’s non-rule policy denies me the unrestricted freedom to enjoy my vessel as a second home.”
The Issue The issues in the case are whether the allegations set forth in the Administrative Complaint are correct, and, if so, what penalty should be imposed.
Findings Of Fact At all times material to this case, the Respondent was licensed as a real estate sales associate, holding Florida license number 3035990. In late spring of 2005, the Respondent was contacted by Arnold Macabugao, a California resident who was interested in acquiring a home in Orlando, Florida, for himself and his wife. The Respondent was aware of a house for sale at 14213 Sports Club Way, Orlando, Florida 32837, which she apparently thought would be suitable for the Macabugaos' purchase. The owner of the house was Jack Girton. Mr. Girton did not reside in the property at any time material to this dispute. The Girton house was inhabited by a woman identified as Kim Capiello. Ms. Capiello was an acquaintance of Mr. Girton's. Ms. Capiello had no ownership interest in the property. All documents related to the purchase of the property by the Macabugaos identified Mr. Girton as the owner. During negotiations on the property, the Respondent provided all documents to Ms. Capiello. It is reasonable to conclude that Ms. Capiello transmitted the documents to Mr. Girton. There is no evidence that the Respondent dealt directly with Mr. Girton at any time during the sales process. The weight of the evidence establishes that the Respondent negotiated the Macabugaos' purchase of the Girton property through Ms. Capiello. At some point in the negotiations, the Respondent received a document titled "SIDE AGREEMENT TO PURCHASE CONTRACT" from Ms. Capiello. The document, which required payment of $10,000 directly to Ms. Capiello by the Macabugaos, in relevant part, provided as follows: This side agreement is between Buyers named above and Kim Capiello wherein the buyers agree to give $10,000 to Kim Capiello for services rendered in the search and purchase of the above named property. This agreement is contingent upon the buyers securing a loan, its lender determining a firm closing date and last but not the least, actual closing and funding of the above named property. The amount will be paid as follows: $5,000 to be paid at the time the Purchase contract is signed by all parties for the above property and contingent upon the buyers securing a loan and its lender determining a firm closing date. $5,000 to be paid the day after the closing under the condition being that the above property has been vacated and in move in condition. Kim Capiello further agrees that this side agreement is between her and the buyers only and has nothing to do with the actual purchase agreement entered into by the buyers and Jack Girton. (Emphasis in original) The Respondent facilitated the payment of the $10,000 by the Macabugaos to Ms. Capiello pursuant to the side agreement. The Respondent transmitted the document to the Macabugaos, who signed it. A signature purportedly of Ms. Capiello is also on the document. The Respondent instructed the Macabugaos on how to make the payments. She collected the funds from them. The Respondent used her personal checking account as a transfer mechanism for one of the $5,000 payments. The side agreement does not identify the date of execution, but Mr. Macabugao testified that he signed the side agreement after the sales contract had been signed. The executed sales contract between the Macabugaos and Mr. Girton was dated June 7, 2005. Mr. Macabugao testified that he had no communication with Ms. Capiello. The evidence fails to establish the Macabugaos' rationale for agreeing to make the payments to Ms. Capiello, other than the fact that the Respondent transmitted the document to the Macabugaos and instructed them on how to make the payments. None of the sales documents suggested that Ms. Capiello held licensure in Florida as a real estate professional. Based upon a review of the Petitioner's licensure files, the Petitioner's investigator testified that Ms. Capiello was not licensed in Florida as a real estate professional in any capacity. There was no credible evidence to the contrary, and the investigator's testimony has been credited.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Petitioner enter a final order finding Eleanor Borling Dioneda guilty of violating Subsection 455.227(1)(j), Florida Statutes (2005); imposing a two-year license suspension followed by a two-year probationary period; imposing a fine of $5,000; and requiring completion of a remedial professional education course to be determined by the Petitioner. DONE AND ENTERED this 11th day of August, 2008, 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 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 11th day of August, 2008. COPIES FURNISHED: Jason W. Holtz, Esquire Department of Business and Professional Regulation 400 West Robinson Street, Suite 801N Orlando, Florida 32801-1757 Eric W. Ludwig, Esquire 250 North Orange Avenue, Suite 1250 Orlando, Florida 32801 Ned Luczynski, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Thomas W. O'Bryant, Jr., Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street, Suite 802N Orlando, Florida 32801
The Issue Whether Respondent, Royal Arms Villas Condominium, Inc., discriminated against Petitioners, Eric and Nora Gross, in violation of the Florida Fair Housing Act.
Findings Of Fact Petitioners are a married couple, living in a rental home at 209 Yorkshire Court, Naples, Florida (rental unit). Petitioners have two children and two grandchildren; however, none of these relatives live in Petitioners’ rental unit. Mr. Gross was diagnosed with stage four hodgkin’s lymphoma in 2002. Mr. Gross has been in remission since 2003. Mr. Gross was declared disabled by the Social Security Administration in 2003. Petitioners have lived in this rental unit since August 2006. A Florida residential lease agreement with the property owners, Joan and Charles Forton, was entered on August 8, 2006.3/ This lease was for a 12-month period, from September 1, 2006, through August 31, 2007. At the end of this period, the lease became a month-to-month lease and continued for years without anyone commenting on it. In 2012, Respondent inquired about a dog that was seen with Petitioners. After providing supporting documentation to Respondent, Petitioners were allowed to keep Mr. Gross’ service dog, Evie. Respondent is a Florida not-for-profit corporation. There are 62 units, and the owner of each unit owns a 1/62 individual share in the common elements. Since its inception, Respondent has, through its members (property owners), approved its articles of incorporation, bylaws, and related condominium powers, and amended its declaration of condominium in accordance with Florida law. Ms. Orrino is currently vice-president of Respondent’s Board of Directors (Board). Ms. Orrino has been on the Board since 2009 and has served in every executive position, including Board president. Ms. Orrino owns two condominiums within Respondent’s domain, but does not reside in either. In 2012 or 2013, Respondent experienced a severe financial crisis, and a new property management company was engaged. This company brought to the attention of Respondent’s Board that it had not been approving leases as required by its Declaration of Condominium.4/ As a result of this information, the Board became more pro-active in its responsibilities, and required all renters to submit a lease each year for the Board’s approval. Petitioners felt they were being singled out by Respondent to provide a new lease. The timing of Respondent’s request made it appear as if Respondent was unhappy about Petitioners keeping Evie. Petitioners then filed a grievance with HUD.5/ HUD enlisted the Commission to handle the grievance, and Mr. Burkes served as the Commission’s facilitator between Petitioners and Respondent. On October 24, 2013, Petitioners executed a Conciliation Agreement (Agreement) with Respondent and the Commission. The terms of the Agreement include: NOW, THEREFORE, it is mutually agreed between the parties as follows: Respondent agrees: To grant Complainants’ request for a reasonable accommodation to keep Eric Gross’s emotional support/service dog (known as “Evie”) in the condominium unit even though it exceeds the height and weight limits for dogs in the community. That their sole remedy for Complainants’ breach of the provisions contained in subparagraphs (a) through (g) below, in addition to the attorney’s fees and costs provision of paragraph 10 of this Agreement, shall be the removal of the Complainants’ dog. Complainants agree: That they will not permit the dog to be on common areas of the association property, except to transport the dog into or out of Complainants’ vehicle, to and from Complainants’ unit, and to take the dog through the backyard of the unit to walk it across the street off association property. That if the dog is outside of the condominium unit, they will at all times keep the dog on a leash and will at all times maintain control of the dog. That if their dog accidentally defecates on association property, they will immediately collect and dispose of the waste. That they are personally responsible and liable for any accidents or damages/injuries done by the dog and that they will indemnify and hold the Respondent harmless and defend Respondent for such claims that may or may not arise against Respondent. That they will not allow the dog to be a nuisance in the community or disrupt the peaceful enjoyment of other residents. A nuisance will specifically include, but is not limited to, loud barking and any show of aggressive behavior, including, but not limited to, aggressive barking, growling or showing of teeth regardless of whether the dog is inside or outside of the unit. That they will abide by all community rules and regulations of Respondent with which all residents are required to comply, including but not limited to submitting to the required pre-lease/lease renewal interview, and completing a lease renewal application and providing his updated information to Respondents and submitting to Respondent a newly executed lease compliant with Florida law and the Declaration of Condominium. The pre-lease/lease renewal interview will be conducted at Complainants’ unit at a time and date agreeable to the parties but not to exceed 30 days from the date of this agreement. If Complainants’ current dog “Evie” should die or otherwise cease to reside in the unit, Complainants agree to replace the dog, if at all, with a dog that is in full compliance with the association’s Declaration of Condominium or Rules and regulations in force at that time and will allow the dog to be inspected by Respondent for approval. Respondent agrees to ensure, to the best of their abilities, that their policies, performance and conduct shall continue to demonstrate a firm commitment to the Florida Civil Rights Act of 1992, as amended, Sections 760.20-37, Florida Statutes, (2012), and the Civil Rights Act of the United States (42 U.S.C. 1981 and 1982 and 3601 et.seq). [sic] Respondent agrees that it, its Board members, employees, agents and representatives shall continue to comply with Title VIII of the Civil Rights Act of 1968, as amended by The Fair Housing Act, which provides that Respondents shall not make, print or publish any notice, statement of advertisement with respect to the rental or sale of a dwelling that indicates any preference, limitation or discrimination based on race, color, religion, national origin, sex, disability or familial status. Respondent also agrees to continue to comply with Title VIII of the Civil Rights Act of 1968, as amended by The Fair Housing Act, which prohibits Respondents from maintaining, implementing and effectuating, directly or indirectly, any policy or practice, which causes any discrimination or restriction on the bases of race, color, religion, national origin, sex, disability or familial status. Respondents also agree to continue to comply with Section 504 of the 1973 Rehabilitation Act. It is understood that this Agreement does not constitute a judgment on the part of the Commission that Respondents did nor did not violate the Fair Housing Act of 1983, as amended, Section 760.20-37, Florida Statutes (2011). The Commission does not waive its rights to process any additional complaints against the Respondent, including a complaint filed by a member of the Commission. It is understood that this Agreement does not constitute an admission on the part of the Respondent that they violated the Fair Housing Act of 1983, as amended, or Section 504 of the 1973 Rehabilitation Act. Complainants agree to waive and release and do hereby waive and release Respondent from any and all claims, including claims for court costs and attorney fees, against Respondent, with respect to any matters which were or might have been alleged in the complaint filed with the Commission or with the United States Secretary of Housing and Urban Development, and agree not to institute a lawsuit based on the issues alleged in this complaint under any applicable ordinance or statute in any court of appropriate jurisdiction as of the date of this Agreement. Said waiver and release are subject to Respondent’s performance of the premises and representations contained herein. The Commission agrees that it will cease processing the above-mentioned Complaint filed by Complainants and shall dismiss with prejudice said complaint based upon the terms of this Agreement. Respondent agrees to waive and release any and all claims, including claims for court costs and attorney fees, against Complainants with respect to any matters which were or might have been alleged in the complaint filed with the Commission or with the United States Secretary of Housing and Urban Development, and agree not to institute a lawsuit based on the issues alleged in these complaints under any applicable ordinance or statute in any court of appropriate jurisdiction as of the date of this Agreement. Said waiver and release are subject to Complainants’ performance of the premises and representations contained herein. The parties agree in any action to interpret or enforce this agreement the prevailing party is entitled to the recovery from the non-prevailing party its reasonable attorney’s fees and costs, including attorney’s fees and costs of any appeal. FURTHER, the Parties hereby agree that: This Agreement may be used as evidence in any judicial, administrative or other forum in which any of the parties allege a breach of this Agreement. Execution of this Agreement may be via facsimile, scanned copy (emailed), or copies reproduced and shall be treated as an original. This Conciliation Agreement may be executed in counterparts. IN WITNESS WHEREOF, the parties have caused this Conciliation Agreement to be duly executed on the last applicable date, the term of the agreement being from the last applicable date below for so long as any of the rights or obligations described here in continue to exist. Eric Gross and Nora Gross signed the Agreement on October 24, 2013. Ms. Orrino, as President of Respondent, signed the Agreement on September 9. The Commission’s facilitator, Mr. Burkes, signed the Agreement on October 24. The Commission’s housing manager, Regina Owens, signed the Agreement on October 30, and its executive director, Michelle Wilson, signed the Agreement on November 4. The effective date of the Agreement is November 4, the last day it was signed by a party, and the clock started running for compliance. Petitioners failed to abide by the Agreement in the following ways: Petitioners failed to submit an updated lease agreement that conformed to Respondent’s rules and regulations. Petitioners failed to submit to the required pre- lease/lease renewal interview within 30 days of signing the Agreement. Petitioners failed to complete a lease renewal application. Petitioners failed to provide updated information to Respondent. It is abundantly clear that Eric Gross and Ms. Orrino do not get along. However, that personal interaction does not excuse non-compliance with an Agreement that the parties voluntarily entered. Each party to the Agreement had obligations to perform. Respondent attempted to assist Petitioners with their compliance by extending the time in which to comply, and at one point, waving the interview requirement. Petitioners simply failed to comply with the Agreement. Petitioners failed to present any credible evidence that other residents in the community were treated differently. Mr. Gross insisted that the Agreement had sections that Petitioners did not agree to. Mr. Burkes was unable to shed any light on the Agreement or the alleged improprieties that Mr. Gross so adamantly insisted were present.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Florida Commission on Human Relations dismissing the Petition for Relief filed by Petitioners in its entirety. DONE AND ENTERED this 17th day of March, 2015, in Tallahassee, Leon County, Florida. S LYNNE A. QUIMBY-PENNOCK 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 17th day of March, 2015.
Findings Of Fact Petitioner is a state governmental licensing and regulatory agency charged with the responsibility and duty to prosecute administrative complaints pursuant to the Laws of Florida, in particularly, Section 20.30, Chapters 120, 455 and 475, Florida Statutes, and rules and regulations promulgated pursuant thereto. Respondent James F. D'Alvia is now, and was at all times material hereto, a licensed real estate agent in Florida, having been issued license number 0464978. The last license issued was as a salesman, c/o Conti and Associates, Inc., 135 State Street, Oldsmar, Florida 34677. During times material, Respondent James F. D'Alvia, while licensed as a salesman with ERA Real Estate Emporium, 161 West SR 584, Oldsmar, Florida, was under the supervision of John A. Conti, the qualifying broker for ERA Real Estate Emporium. During times material, Respondent leased a condominium unit from Mary Louise Scussle (Scussle) as landlord/owner, Unit B-1, located at 6306 Newtown Circle, Tampa, Florida. On or about December 7, 1986, Respondent D'Alvia sublet the condominium owned by Scussle to Robert G. Loving. In accordance with the sublease agreement between Respondent and Loving, Respondent obtained check number 200 dated December 4, 1986, payable to Respondent in the amount of $250.00 as a security deposit. Respondent thereafter cashed the check received by him on the same day, December 6, 1986. At the time of Respondent's lease of Scussle's condominium, Scussle was anxious to sell as she was sustaining a shortfall from the rent proceeds versus the mortgage payments that Scussle was obliged to pay. About May 2, 1987, sublessee Loving moved from the condominium and was unable to contact Respondent to obtain his security deposit. Respondent was not aware that Loving had made attempts to contact him. The lease agreement entered into by Respondent with Mary Louise Scussle called for Respondent to lease Scussle's condominium for a one-year period. Respondent gave Scussle a security deposit and one month's rent in advance. During December 1987, Respondent advised Scussle of his financial problems and inquired if he could sublet the condominium. Owner Mary Louise Scussle did not object to Respondent's attempt to sublet the property and in fact welcomed his attempt to do so. During times material, Respondent, Mary Louise Scussle and Robert Loving were all aware of the sublease agreement between them and none of the parties to the agreement voiced any objections to the agreement. Sublessee Loving was advised by Respondent D'Alvia that he would receive his security deposit from owner Scussle at the expiration of the lease agreement. Likewise, Respondent Conti was apprised of Respondent D'Alvia's agreement to lease Scussle's condominium. Mary Louise Scussle admits that Respondent advised her and she approved the sublease agreement between Respondent and Loving; however, Scussle's testimony is devoid of and she was not able to recall the specifics of the agreement between Respondent and sublessee Loving. As example, Scussle was unable to recall if Loving or Respondent D'Alvia was the sublessee. While Scussle "thinks" that Respondent D'Alvia was the first tenant and Loving was the sublessee, the passage of time has paled her recall as to specifics. Robert Loving did not appear as a witness to testify in these proceedings.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended Petitioner enter a Final Order dismissing the Administrative Complaint relating to Respondent John F. D'Alvia in its entirety. 2/ RECOMMENDED this 20th day of September, 1990, in Tallahassee, Leon County, Florida. JAMES E. BRADWELL 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 20th day of September, 1990.
Findings Of Fact This case concerns what is-called a "Turnkey Lease". The program was developed by the State of Florida in 1971. It encompasses a situation where by agencies seeking space for their operations may, after a specific need is determined that cannot be filled by existing adequate space, solicit competitive bids from developers for the provision of land and the construction of a building thereon sufficient to-meet the agency's needs, for lease specifically to the agency requesting it. The Bureau of Property Management within DGS was given the initial responsibility to develop the guidelines, promulgate the rules, and seek statutory authority for such a program. The Bureau's current role is to work with agencies requesting this program. The agency certifies the need to the Bureau in addition to the fact that there is no available existing space present. The Bureau then determines agency needs and gives the agency the authority to solicit the bids for the turnkey project. Once the bids are then received, evaluated, and a recommendation for an award is forwarded by the agency to DGS, DGS reviews the supporting documents required by the provision of the Florida Administrative Code and either concurs or does not concur in the recommendation. If DGS concurs, the submitting agency is notified and is permitted to then secure the lease. Once the lease has been entered into; it is then sent back to DGS for review and approval as to the conditions; and thereafter the plans and specifications for the building are also referred to DGS for review and approval as to the quality and adequacy as well as code compliance. Section 255.249 and Section 255.25, Florida Statutes, set forth the requirements for soliciting and awarding bids for lease space in an amount in excess of 2,500 square feet. This provision requires that an award of this nature be made to the lowest and best bidder, and DCS utilizes that standard in evaluating and determining whether or not it will concur with an agency's recommendation. In the instant case, DHRS advertised for bids for the construction of office space in Palatka, Florida for its District III facilities. Before seeking to solicit bids, the District III staff conducted a search for other possible existing space within a five mile radius of the downtown area and located no adequate facilities. Thereafter, a Certification of Need was processed for a solicitation of proposals and approval was granted by DGS to follow through with the solicitation. A preproposal conference was advertised and held on October 14, 1983, and after project review by those present at the conference, bid opening date was set for November 22, 1983. Thirty-two bid packages were distributed and twelve bidders submitted proposals. The public bid opening was held as scheduled at 2:00 p.m., on November 22, 1983, in Palatka, Florida by Robert E. Litza, Facilities Services Coordinator for DHRS District III. Of the bids submitted by the twelve bidders, the lowest hid was rejected because of the failure of the bidder to comply with the requirements of the bid package. Of the remaining eleven bids, the four lowest were evaluated with the understanding that additional higher bids would be evaluated if the four lowest bids were found to be unacceptable. Among the four bids considered were bids of Chuck Bundschu, Inc., Kenneth R. McGurn, one of the Intervenors (McGurn submitted five prices scheduled for his bid and of these, only one was considered); Elizabethan, Petitioner herein; and TSU. Only three bids are pertinent to the discussion here. They are #8-C (McGurn); #11 (Elizabethan); and #12 (TSU). In pertinent particulars, these bids provided as to rental costs: 8-C 11 12 1st yr $14.00/$220,808 $8.95/$ 61,916.10 S 7.16/$ 49,532.88 2nd yr 14.00/ 220,8088 8.95/ 141,159.40 7.35/ 115,924.20 3rd yr 14.00/ 220,808 8.95/ 141,159.40 7.62/ 120,182.64 4th yr 14.00/ 220,808 8.95/ 141,159.40 8.08/ 127,437.76 5th yr 14.00/ 220,808 8.95/ 141,159.40 8.33/ 131,380.76 6th vr 14.00/ 220,808 8.95/ 141,159.40 8.59/ 135,481.48 7th yr 14.00/ 220,808 8.95/ 141,159.40 8.86/ 139,739.92 8th yr 14.00/ 220,808 8.95/ 141,159.40 9.19/ 144,944.68 9th yr 14.00/ 220,808 8.95/ 141,159.40 9.58/ 151,095.76 10th yr 14.00/ 220,808 8.95/ 141,159.40 10.09/ 159,139.48 Renewal Option 1st yr3.00/47,316 9.93/ 156,615.96 10.51/ 165,763.72 2nd yr3.00/47.316 9.93/ 156,615.96 10.99/ 173,334.28 3rd yr3.00/47.316 9.93/ 156,615.96 11.48/ 181,062.56 4th yr3.00/47.316 9.93/ 156,615.96 11.99/ 189,106.28 5th yr3.00/47.316 9.93/ 156,615.96 12.51/ 197,307.72 Total Basic Overall Lease 1-15 yrs $1,971,500 $2,115,430.50 $2,181,434.12 Average Sq.Ft. for 15 yrs $8.60 $9.20 $9.58 A recommendation by the evaluation committee which met at DHRS District III, that McGurn's bid be selected, was forwarded to DGS in Tallahassee through the Director of DHRS's General Services in Tallahassee on December 22, 1983. The terms of the successful bid and the reasons for its being considered lowest and best are discussed below. The successful bid for the lease in question, lease number 590:8030, upon completion of the committee's evaluation was also evaluated by Ms. Goodman in the Bureau of Property Management of DGS. She also considered the McGurn bid to be the lowest and best of the eleven non-disqualified bids. In that regard, not only Mr. McGurn's bid but all of the twelve bids received were considered and reviewed not only at the local level but at DHRS and DGS headquarters as well. In her evaluation of the proposal and the bids, Ms. Goodman considered the documentation submitted by DHRS. This included a letter of recommendation supported by a synopsis of all proposals, the advertisement for bids, and any information pertinent to the site selection process. In determining the McGurn's bid was the lowest as to cost of all the bids, Ms. Goodman compared the average rate per square foot per year for each. This did not take into con- sideration pro-ration of costs per year, but strictly the average over the fifteen year probable term of the lease (ten years basic plus five year option). According to Ms. Goodman, this same method of calculating cost has been used in every lease involving a turnkey situation and in fact in every lease since 1958 - as long as she has been with DGS. This particular method, admittedly, is not set forth in any rule promulgated by DGS. However, the agencies are instructed by DGS to advertise and bidders to bid on an average square foot basis, the basis utilized by Ms. Goodman and her staff in analyzing the bids submitted. In that regard, the request for proposals does not, itself, indicate how the calculation of lowest cost would be made by DHRS and DGS but it does tell prospective bidders what information to submit. This procedure has been followed exclusively in situations like this for may years and many of the bidders here have bid before using this same system. All bidders are considered on the same footing in an evaluation. They are notified of what information will be considered along with that of all the other bidders. Further, anyone who inquires as to the basis for evaluation will be given a straight and complete answer as to the method to be used. Petitioner contends that McGurn's bid does not conform to either the normal bidding procedure followed by contractors in this type of procurement over the past years or to the normal bidding procedures adopted by Respondent, DHRS. It urges that the questioned bid is non-responsive and front-end loaded to the detriment of DHRS. With regard to the front-end loading objection, Mr. Taylor, testifying for Petitioner, attempted to indicate by graphic evidence that Elizabethan's bid, which he claims is not front-end loaded, is cheaper to the State than that of McGurn. Due to the large rental cost of the McGurn bid in the opening years of the lease, the State would have to borrow money to make the large rental payments; the interest cost of which, when added to the $3.00 cost in the option years, raises the cost considerably and makes the bid not the lowest. Though Mr. Taylor testified to this he failed to produce any independent evidence to support it. In addition, Taylor urges, under the McGurn schedule, McGurn would recoup his entire construction debt (approximately $423.00 plus interest) in the first four years of the lease: Comparing the two bids, it appears that the State would pay McGurn approximately $494,500.00 more than it would pay Elizabethan for the same period during the first seven years of the lease. Considering this, it is Taylor's belief that McGurn's profit after the fourth year is excessive. He contends also that when, after the tenth year, McGurn's rental rate drops to $3.00 per square foot for the remaining five years which constitutes the option period of the lease, the State could not afford to leave the low figure and as a result, the ten year lease is converted to a l5 year lease which is unresponsive. Further, the $3.00 figure for the last years, which would ostensibly show a loss to McGurn, is misleading in that there would be sufficient income from the advance profit garnered in years 5 to 10, when invested, to cover the soft costs and more in these later years. Admitting that because of its involvement in other turnkey projects in Florida, Elizabethan is aware of the State policy on cost evaluation, Taylor contends that while his bid does not violate State policy, McGurn's bid does because it would be fiscally irresponsible for the State to pay so much up front. This conclusion is his opinion, however, and not supported by any independent evidence. Both expert witnesses, Respondents Scott and Perry, who testified for the Intervenor, TSU, agree that the present value of money should be considered in evaluating rental costs. Their major point of difference is in the percentage of discount rate to be applied. Dr. Perry urges that use of the 10% rate mandated by the U. S. Government in its procurements of this nature. Dr. Scott, on the other hand, considers this to be too high and urges a rate in the area of 3% be used. The significance of this is that at the lower of the range spread, McGurn's bid is lowest. At the higher end, TSU's bid is lowest. From 5.7% up to below 6%, Petitioner's bid is lowest. Whichever would be appropriate, the State has not adopted the present value of money methodology and the policy followed by the State is not to consider that methodology in analyzing costs. State policy is to use only the average rental methodology. There is, in addition, no prohibition against front- end loaded bids encompassed within this policy. By the same token, there is nothing in the bid package issued to all prospective bidders that in any way stipulates the method of computing lease costs or prohibits from loaded bids. DGS zone rates, criteria stipulating the maximum agencies can send on rent without approval by DGS, are not part of the bid package and do not constitute a factor in determining whether a bid is conforming or not. These zone rates may be waived by DGS at the time the proposed award is submitted for DGS approval. In practice, within the memory of Joseph Lambert, HRS' Administrator of Facilities Services, who administers the Department's leasing program, he cannot recall DGS ever denying a DHRS request for waiver of the maximum zone rate in any case where it was pertinent. In this case, since the lease payments at-least in the second through tenth years-of the McGurn bid exceed the zone limits, the award would have to be approved by the Governor and Cabinet in addition to DGS. It has not yet been placed on the Cabinet agenda because of the protests filed. As was stated before, there are no rules governing the evaluation of bids for leases of this nature. Oral instructions given to each agency, when applied here, reveal that the McGurn bid, as was seen above, has an average cost of $8.86 per square foot per year. TSU's bid costs $9.58 per square foot per year, and Elizabethan's bid costs $9.29 per square foot per year. These same calculations are followed on all turnkey and non- turnkey leases in the State. The reason the State uses this process instead of the present value of money methodology is that it is easy. DGS statistics indicate that at least 50% of the landlords in the approximately $32,000,000 worth of leases presently existing with the State are "Mom and Pop" landlords. These people are not normally trained lease evaluators. By using the straight average rental rate method, there are no arbitrary variables. It has always worked because people can understand it and all agencies which lease property in the State follow this procedure. In the opinion of Ms. Goodman, the costs involved in utilizing the present value of money methodology would far outweigh the paper savings to be gained, notwithstanding the testimony of Dr. Perry to the contrary. With regard to the option issue, it was the position of DGS in reviewing the proposals that the very low $3.00 lease cost per square foot in the last five years (the option period) did not make the McGurn bid unresponsive. There were no limits imposed upon the bidders except that a five year option to a ten year lease be included. Were it not there, the bid would be unresponsive. DGS would issue approval for a ten year lease with a five year option but not a fifteen year lease. Ms. Goodman cannot recall a situation in which an option was not exercised by it if the need for the space continued though there have been some instances where option costs have been renegotiated.
Recommendation Based on the foregoing, it is, therefore; RECOMMENDED THAT DHRS License Number 590:8030 be awarded to Kenneth R. McGurn. RECOMMENDED this 5th day of September, 1984, in Tallahassee, Leon County, Florida. ARNOLD H. POLLOCK Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkwav Tallahassee, Florida 32301 Filed with the Clerk of the Division of Administrative Hearings this 5th day of September, 1984. COPIES FURNISHED: David Pingree, Secretary Department of Health and Rehabilitative Services 1323 Winewood 8Oulevard Tallahassee, Florida 32301 Morgan Staines, Esquire 2204 East Fourth Street Santa Ana, California 92705 Thomas D. Watry, Esquire 1200 Carnegie Building 133 Carnegie Way Atlanta, Georgia 30303 Steven W. Huss, Esquire Department of Health and Rehabilitative Services 1317 Winewood boulevard Tallahassee, Florida 32301 Ronald W. Thomas, Executive Director Department of General Services 115 Larson Building Tallahassee, Florida 32301 Steven W. Huss Assistant General Counsel Department of Health and Rehabilitative Services 1317 Winewood Blvd. Tallahassee, Florida 32301 Gary J. Anton, Esquire P.O. Box 1019 Tallahassee, Florida 32302 Harden King, Agency Clerk Assistant General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Building One, Suite 406 Tallahassee, Florida 32301
Findings Of Fact At all times relevant hereto, respondent, Alexander Alexander, Jr., held real estate salesman license number 0000747 issued by petitioner, Department of Professional Regulation, Division of Real Estate (Division). He has been licensed by the Division since 1971. He has worked for Earl Hollis, Inc., a Palm Beach realty firm, since 1980. Respondent has never been the subject of disciplinary action prior to the filing of this complaint. The administrative complaint alleges that respondent failed to deposit in his employer's trust account certain funds received from a prospective purchaser in conjunction with a real estate transaction handled by respondent in early 1986, and that respondent made false representations to the listing broker during the course of his dealings. The transaction in question had its origins in late 1985 when Linda O'Connell, a well-to-do housewife from Dallas, Texas, contacted respondent and requested his services in locating a Palm Beach County residential property adjacent to the ocean or intracoastal waterway. After a one month search, respondent located a waterfront property at 2020 South Ocean Boulevard in Manalapan, Florida. The property was a large home fronting the ocean on one side and the intracoastal waterway on the other. The house was then owned by Kudu Shipping Corporation, S.A. (Kudu), an entity with offices in London, England. When the property was first listed, the asking price was $2,300,000. By now, this price had dropped to $1,750,000. Merrill Lynch Realty (MLR), a real estate firm in Palm Beach, had obtained an exclusive one-year listing on the property for calendar year 1985. This meant the property could be shown only in the presence of a sales representative of that firm. MLR's associate manager, Deborah M. Clark, was the firm's contact person for parties interested in inspecting and making offers on the house. Although the exclusive listing expired on January 1, 1986, it was renewed by Clark about thirty days later for another year. On January 14, 1986, Linda O'Connell and her husband, Tom, in the presence of respondent and Clark, inspected the house in question. During the course of the inspection Clark mentioned to the O'Connells that, in light of other offers she had received, she did not think the seller would make any needed repairs or agree to owner financing. However, because the property was in disrepair, Tom O'Connell did not think $1,750,000 was a fair asking price. Linda O'Connell liked the home and requested that respondent prepare an offer in the amount of $1,300,000 with financing and inspection contingencies. She also gave respondent a check in the amount of $10,000 but specifically asked that respondent not deposit the check until she was sure Kudu was serious about accepting her offer. It was her intention that respondent merely hold the check as evidence of "good faith," and if Kudu expressed interest in the offer, she would then use the $10,000 as a part of the ten percent earnest money deposit required by the contract. According to respondent, O'Connell's instructions were not "unusual" and were occasionally made by customers on large transactions. In contrast, checks were never held by MLR, and a contract would not be presented until the check was given to the firm for immediate deposit in its trust account. In any event, when he accepted the check, respondent considered it to be "an earnest money deposit." The offer was prepared on the standard real estate contract form, was dated January 14, 1986, and listed only Linda O'Connell (but not her husband) as buyer. It contained a notation that Earl Hollis, Inc. would hold a ten percent deposit, or $130,000, in escrow, with the following explanation: "$10,000 rec'd 1/14/86; balance of $120,000 payable upon acceptance of contract." It also contained contingency clauses for O'Connell to obtain a $1,040,000 mortgage for a term of fifteen years and for the seller to repair any deficiencies found in the seawall, roof, or electrical and plumbing systems. After preparing the offer, and pursuant to Clark's request, respondent carried the original contract and a copy of O'Connell's check to Clark on January 15. Consistent with O'Connell's instructions, respondent retained the original check in his office file and did not give it to his employer for deposit in the firm's escrow account. Other than advising Clark that he had a $10,000 check from O'Connell, there were no further conversations by the two concerning the deposit. Respondent did not tell Clark that the $10,000 check had not been deposited. Even so, there was no intent on the part of respondent to deceive or trick the seller or to conceal any material matters. Clark mailed Kudu the offer on January 15. On January 24, she received by return mail the contract from Kudu. The contract carried an illegible signature of a Kudu principal, and had been amended by increasing the selling price from $1,300,000 to $1,650,000 and providing that the owner would not authorize any financing on the house or make needed repairs. Because the sellers had increased the selling price and rejected the contingencies, Clark "guessed" the O'Connells' original offer had been rejected. After respondent was advised by Clark of this counteroffer, he relayed the information to the O'Connells. Because Tom knew his wife wanted the house, he agreed to up the price to $1,500,000. Respondent telephoned this figure to Clark. During the course of their conversation, Clark told respondent she had just received a full price offer with no contingencies from another interested buyer, Omnitek Intertrade Corporation (Omnitek), a Fort Worth, Texas firm. Believing that the house might be sold to another buyer, Linda O'Connell advised respondent around noon on Saturday, January 25, that she would accept Kudu's counteroffer of $1,650,000 with no contingencies. Linda and respondent met at the West Palm Beach airport the same day where she executed the contract and gave respondent a check in the amount of $165,000. However, she asked that he hold it for two or three days so that she could return to Dallas and transfer funds into the bank account on which the check was drawn. At the same time, she asked for and received her original $10,000 check which had been held by respondent but never deposited. Since it was a Saturday when the two met, respondent could not give the second check to his employer until the following Monday, January 27. This was because Gloria More was the only person in Earl Hollis, Inc. who could make deposits and she did not work on weekends. Further, the banks were closed. Respondent held the check until either Monday or early Tuesday morning and then gave it to More who deposited it in the firm's trust account on Tuesday, January 28. This is confirmed by the firm's deposit slip, which reflects the check was deposited in the bank on January 28. That same weekend respondent carried the contract and a copy of the $165,000 check to MLR. Since Clark was not there, respondent simply left the documents at her office. However, on Monday he telephoned Clark and told her he was "holding" a $165,000 check for the transaction. There was no representation by respondent, either express or implied, that Earl Hollis, Inc. had $175,000 in its trust account for this transaction. By now Mr. O'Connell was having second thoughts about paying $1,650,000 for the house and suspected he may have been snookered into raising his offer by Clark's vague reference to another pending full-price contract. These suspicions may have been well-founded since it turned out the Omnitek contract was not for the full price of $1,750,000, but was for $50,000 less, and had some standard contingencies. It also turned out that when the O'Connells inspected the property on January 14, contrary to Clark's representations, she had not yet received any written offers on the house. Mr. O'Connell accordingly requested a copy of the other so-called "full offer" contract from MLR. After having no luck, he wrote the president of Merrill Lynch stating he would not be bound by his wife's offer unless he was given information regarding the so- called "full offer" contract. On Wednesday, January 29, Linda O'Connell directed her bank to stop payment on the $165,000 check. The check was later returned to Earl Hollis, Inc. with a notation of "Insufficient Funds." 1/ For the first time, respondent and his employer learned of O'Connell's stop-payment order. There is no question that, had the O'Connells followed through with the sale, they had sufficient assets to cover the check and buy the house. On February 6, an MLR secretary telephoned the Texas bank on which the $165,000 check had been drawn. The firm learned that a stop-payment order had been placed on the check. Clark then telephoned respondent to give him this information. Clark later filed a complaint against respondent with the Division charging that respondent had failed to deposit the initial $10,000 deposit. This prompted the initiation of this proceeding. The Kudu house was eventually sold to another buyer for $1,315,000.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondent be found guilty of violating Subsection 475.25(1)(k), Florida Statutes (1985), as alleged in Count I, and that he pay a $500 fine. DONE AND ORDERED this 22nd day of December, 1987, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 22nd day of December, 1987.
The Issue Whether Respondent real estate broker is guilty of a discriminatory housing practice against Petitioners related to the sale and marketing of their home.
Findings Of Fact Petitioner homeowners allege that Respondent real estate broker discriminated against them by the length of the exclusive listing contract Petitioners signed with Respondent (eight months); by inferior service because Respondent showed Petitioners' home only once in the eight months the contract was in effect1/; by incorrectly stating the agreed asking price on flyers Respondent circulated; by providing an "open house" to all of Respondent's other clients, but not to Petitioners; and by asking Petitioners to remove some of their bi-racial family photographs. Petitioner Donald Smith, Ph.D., is Caucasian. He is married to Miranda Smith, a dentist, who is African-American. They have at least one child, with whom they have been photographed. This case involves a house they owned on Cressida Circle in Spring Hill, Florida, where they displayed their bi- racial family photographs. On or about January 28, 2007, Petitioners signed, as sellers, an exclusive real estate listing contract with Kathlen Hobbs, a real estate salesperson, who at that time was an independent contractor associated with Exit Realty Shoppe. Respondent Montgomery, real estate broker, is the qualifying principal of Exit Realty Shoppe. Both Ms. Hobbs and Ms. Montgomery are Caucasian. The agreed asking price was $296,900.00. The term of the contract was for eight months: January 30, 2007, to October 1, 2007. Mr. Smith interviewed two other realtors, but he selected Ms. Hobbs and Respondent's proffered contract. It is a "fill-in the blanks contract," to which Mr. Smith had input. Although she signed the contract, Mrs. Smith did not speak to either Ms. Hobbs or Ms. Montgomery concerning the sale of the house at any material time. Mr. Smith testified that Ms. Hobbs initially told him that their home was "priced to sell" at $296,900.00, but he candidly admitted that Ms. Montgomery never made that representation and never "guaranteed" that the house would sell at that price. Upon the evidence as a whole and because Mr. Smith testified at one point that the other two realtors he interviewed told him the house would sell at "$295,000.00 or $296,000.00," and also testified contrariwise that Ms. Hobbs and the other two realtors told him the house would sell at "between $292,000.00 and $298,000.00," it is found to be more probable that no one guaranteed a sale at Petitioners' asking price of $296,900.00. Petitioners seek damages of $15,000.00, without stating any specific basis for that figure. They previously have sought $40,000.00, damages based upon the alleged lowered price of the house as sold by a subsequent realtor. However, the final date of sale and final sale price are not clear on this record. Paragraph Nine of the parties' contract provided for its early termination prior to its eight-month expiration date, upon the following terms: CONDITIONAL TERMINATION: At Seller's request, Broker may agree to conditionally terminate this Agreement. If Broker agrees to conditional termination, Seller must sign a withdrawal agreement, reimburse Broker for all direct expenses incurred in marketing the Property and pay a cancellation fee of $ plus applicable sales tax. Broker may void the conditional termination and Seller will pay the fee stated in paragraph 6(a) less the cancellation fee if Seller transfers or contracts to transfer the Property or any interest in the Property during the same time period from the date of conditional termination to Termination Date and Protection Period, if applicable. (Blank space in original; emphasis supplied.) Paragraph Six of that listing contract provides, in pertinent part: 6. COMPENSATION: Seller will compensate Broker as specified below for procuring a buyer who is ready, willing and able to purchase the Property or any interest in the Property on the terms of this Agreement or on any other terms acceptable to Seller. Seller will pay Broker as follows (plus applicable sales tax) 6% of the total purchase price OR $ , no later than the date of closing specified in the sales contract. However, closing is not a prerequisite for Broker's fee being earned. (Blank space in original.) Steve Van Slyke has been an active licensed real estate broker for over 20 years. For the last few years he has done more property appraisals than real estate sales. He has regularly taught and taken continuing education courses in the real estate profession since he was admitted to the profession in 1983. He has chaired the Professional Standards Committee of the Hernando County Association of Realtors (HCAR) since 1991. In that capacity, he has presided over hundreds of contract disputes between buyers and sellers, including the one that ultimately developed between the parties in this case. See infra. According to Mr. Van Slyke, the contract in this case is one commonly used in Hernando County, in the sense of not being unusual, but there are no "average," "usual," or "industry standards" for the duration of an exclusive real estate listing contract. He further testified that to have such a generally agreed-upon provision within the real estate industry would run afoul of the United States Fair Trade Commission's jurisdiction of, and prosecution for, "price-fixing." For the same reasons, there is no established average, usual, or industry standard for the conditional early release of a homeowner from a listing contract. Because no dollar amount for a cancellation fee had been written into Paragraph Nine of the parties’ contract herein, Mr. Van Slyke interpreted Paragraph Nine and Sub- paragraph Six (a) together, to permit Respondent broker the latitude to require payment by the sellers of six percent of Petitioners’/sellers’ asking price as a condition of early termination of the contract upon their unilateral request. Respondent submitted in evidence a similar contract dated March 5, 2007, between Respondent and a different homeowner for the duration of one year (12 months) from that date.2/ Petitioners presented no other contracts between any seller and Respondent or, for that matter, between any seller and any other realtor which specified a duration of less than eight months.3/ It is accepted that a different realtor with whom Petitioners contracted in November 2007, after their eight- month contract with Respondent had expired, filled-in “$500.00” in the equivalent Paragraph Nine, but there was no competent, credible evidence that this replacement realtor, or any other realtor for that matter, had a similar arrangement with any other sellers. Petitioners and Ms. Hobbs agreed that Ms. Hobbs would not submit Petitioners' sellers' contract on their existing home to Respondent until she got an acceptance on their offer as buyers for a new house on Rudolph Court. Accordingly, the listing contract for the Cressida Circle house in which Petitioners were living, and which contained their furniture and photographs, was not submitted to Respondent at least until January 31, 2007. Accordingly, Respondent could not begin attempts to sell Petitioners' existing home until the next day, February 1, 2007. There are 185 realty firms in Hernando County. There are four printed real property advertising booklets which are circulated in Hernando and surrounding counties. Each booklet is published every 30 days. The lead time to get a photographic advertisement of a newly listed property into each publication is three weeks. Before a photo can be published, it has to be made. On or about February 1, 2007, Ms. Hobbs photographed Petitioners’ Cressida Circle house for purposes of advertising it via websites, flyers, real estate advertising booklets, and newspapers, and placed Respondent’s "for sale" sign and lock-box on Petitioners' lawn. Respondent had admitted in evidence the first advertisements she paid for in three printed real estate booklets ("Nature Coast", March 22-April 18, 2007; "Real Estate News", April 2007; and "Sunshine Living", April 2007). Each advertisement contained a photograph and information extolling the Cressida Circle house. Each advertisement correctly quoted Petitioners' asking price of $296,900.00. Additionally, Respondent had admitted in evidence documentation showing that from March 22, 2007, until the end of her exclusive listing on September 30, 2007, she had advertised Petitioners' property repeatedly and/or consistently via newspaper, real estate advertising booklets, and/or Multiple Listing Services (MLS) websites and commercial websites. Both parties agree that Ms. Hobbs' first printed flyer stated an incomplete, and thus incorrect, selling price of "$296,90.", and that this flyer was circulated and/or placed in the lock-box tube on the "for sale" sign about February 1, 2007. (See Finding of Fact 17.) Despite Petitioners' claim that this was "inferior marketing," it is probable that most serious home seekers would have figured out how to correctly read the price as "$296,900.00", or would have asked what price was intended when phoning for an appointment to view the house. While Ms. Hobbs' flyer was never corrected, Respondent Montgomery had other, correct flyers printed, and she placed and circulated those correct flyers for the remainder of the contract period. It is customary for Exit Realty to conduct a "caravan" shortly after a contract is signed. A "caravan" involves Ms. Montgomery and all the salespeople she can round-up in her office. The entire team tours a seller's home, making notes, and then returns to Respondent's office, where a list of repairs and upgrades is compiled with each salesperson's in-put. Then the team brain-storms to develop selling techniques customized to each property listed. On February 7, 2007, the day before Caravan Day, an independent contractor with Exit Realty showed Petitioners' home to a potential buyer. Through Ms. Hobbs, the salesperson relayed to Mr. Smith that the potential buyer had remarked that the house's exterior paint was unacceptable. Mr. Smith told Ms. Hobbs that he would paint the house at his own expense if the potential buyer would make an offer, but no offer was forthcoming. Respondent's caravan viewed Petitioners' home on February 8, 2007. As a result, a list of selling suggestions was relayed by Ms. Hobbs to Mr. Smith. A day or so after Caravan Day, Mr. Smith was told by Ms. Hobbs that to best present and sell Petitioners’ home, Petitioners needed to deal with dirt and dust in an exhaust fan; replace a broken tile in a bathroom, and refinish their swimming pool. Mr. Smith also acknowledged that on the same date, or minimally later, he was told by Ms. Hobbs to remove Petitioners' large family photographs over the sliding doors opening from the house's vaulted-ceiling living room onto its screened patio and pool area. According to Ms. Montgomery, she had advised Ms. Hobbs to relay this information and additional advice, including the information that Petitioners’ house would sell better if Petitioners moved out or reduced the amount of furniture in the living room, so that potential buyers could visualize their own belongings in the room. It was not proven one way or the other whether Ms. Hobbs relayed the "move out" or "remove furniture" suggestions at that time. When Mr. Smith pressed Ms. Hobbs as to why the family photographs had to be removed, she referred him to Ms. Montgomery, who "could better explain." Mr. Smith acknowledged that Ms. Hobbs never said anything about race or discrimination. Mr. Smith testified to three versions of why he concluded that Ms. Montgomery was discriminating against Petitioners on the basis of race: first, because neither Ms. Hobbs nor Ms. Montgomery mentioned the bi-racial family photographs until after Ms. Montgomery had first seen them on Caravan Day, and Ms. Hobbs could not explain to his satisfaction the reason for removing the photographs; second, because Ms. Montgomery did not immediately return his phone calls; and third, because when Ms. Montgomery did return his phone calls, she mentioned the photographs over the sliding doors repeatedly among several other upgrades she encouraged him to accomplish, all of which upgrades Ms. Hobbs apparently had not passed along to him. Ms. Montgomery can suggest and encourage her independent contractors to pass on certain information to sellers and buyers and to pursue sales in certain ways, but she has no way to compel them. Mr. Smith conceded that at no time did Ms. Montgomery ever mention race or make any overt discriminatory statement to him and that she responded to all his letters, even though she did not agree with him in those letters. See, infra. Petitioners also agree that at no time did Ms. Montgomery or anyone associated with Exit Realty suggest that Petitioners remove tastefully framed bi-racial family photographs displayed on a bedroom dresser. Ms. Montgomery credibly testified that successfully "staging" a home for sale usually requires removing as much furniture as possible and all of the personalization, such as awards and photographs hung on the walls of all rooms. Mrs. Smith acknowledged that she was familiar with this concept from print literature and television. Ms. Montgomery demonstrated, using a photograph she had taken of the house without the wall photographs in place, that anything mounted above the living room's sliding glass doors had the potential to draw a shopper's eye away from the luxuriant sweep of the vaulted-ceiling and away from the scope and sweep of the view, through the sliding glass doors, of Petitioners' pool and patio. Petitioners accomplished the three repair suggestions (exhaust fan; tile; and swimming pool) that Ms. Hobbs passed on to them, but they remained in the Cressida Circle house and did not remove their furniture or the photographs above the sliding glass doors. In early March, Petitioners requested a reduction in the six percent commission specified in their Cressida Circle contract with Respondent. Respondent declined to consider reducing her commission until someone made an offer to buy. Petitioners closed on their new home on Rudolph Court on March 30, 2007. The Rudolph Court sale and closing in which Petitioners were buyers, was also handled by Hobbs, Montgomery, and Exit Realty. Petitioners do not claim that any racial discrimination by anybody occurred in the process of buying their new home. Closing on the Rudolph Court house left Petitioners with two houses to maintain and at least two (possibly four) mortgages to pay. Petitioners became concerned that no one had made an offer on their Cressida Circle house. Mr. Smith made several telephone calls to Ms. Montgomery. She did not immediately return those calls. When she did return Mr. Smith's phone calls, Ms. Montgomery explained to him that the Cressida Circle house needed to be "staged" better, including removing furniture and the photographs over the patio doors. Ms. Montgomery wrote Mr. Smith on April 5, 2007, to memorialize all of their April 4, 2007, conversation, giving him clear advice that a “lease/purchase procedure,” as opposed to a “lease/option to buy” arrangement which he had proposed, would be a better and safer solution for his needs. She also advised him that no home in his sub-development had been sold in the last seven months, and emphatically advised him to lower his asking price to $269,900.00, due to the competition of other similar homes for sale. It is undisputed that the parties' contract was signed during a "housing market slump" and that the housing market continued to decline during the entire term of the parties' contract. On April 9, 2007, Mr. Smith wrote Ms. Montgomery, making no reference to race or discrimination, but complaining about Exit Realty Shoppe showing his home only one time, requesting to void their contract, and closing with: If necessary we will follow thru [sic.] with a complaint to the Florida Real-estate [sic.] Commission in Tallahassee. Not unreasonably, Ms. Montgomery regarded Petitioners' foregoing letter as a threat. She responded by registered mail on April 10, 2007, setting out in detail all she had done and describing the costs she had incurred as of that date to sell the Cressida Circle house. She enclosed three printed real estate publications advertising Petitioner's house (see Finding of Fact 18); proof that the home was being advertised with the correct price April 7-13, 2007, in the St. Petersburg Times; proof that she had registered the house with the correct price on the MLS; and proof that the house was being shown in color on Exit Realty's three websites and on Ms. Hobbs' personal website with the correct price. She also reminded Mr. Smith that she had, earlier in the week, suggested that Petitioners reduce their asking price by $30,000.00, to $269,900.00. She also advised him, and included information showing, that as of that writing, there were 11 comparable listings in his sub- development, nine of which were listed at less than Petitioners' asking price. Evidence of all of Respondent's foregoing April 10, 2007, assertions was introduced in evidence by Respondent at the final hearing.4/ Respondent's April 10, 2007, letter also explained "staging," and offered to conditionally release Petitioners from their contract for six percent of their $296,900.00 asking price, as per the contract's Paragraph Six (a). Ms. Montgomery's April 10, 2007, unopened letter and supporting documentation were returned to her by the U.S. Mail as "unclaimed." Because Petitioners were still residing at the Cressida Circle address and because the post office did not mark the envelope "refused," it is probable that Petitioners simply did not go to the post office to sign-for, and pick up, Ms. Montgomery's material. However, Petitioners must have received these items because Ms. Montgomery also had the same materials delivered by messenger to Mrs. Smith’s office. Also, on April 11, 2007, Mr. Smith wrote, acknowledging receipt of Respondent's April 10, 2007, letter, refusing to reduce the asking price, and advising Ms. Montgomery that: I feel that it will be my responsibility to express this dissatisfaction in anyway [sic] I can, to as many people as I can. I will do what ever [sic.] I can do to be released from our agreement. He further threatened to contact "different government agencies" to report what he described as very poor service, but he did not mention race or discrimination. On or about April 19, 2007, Mr. Smith filed a complaint against Respondent dated April 16, 2007, with the local Better Business Bureau (BBB). His complaint alleged lack of service. Nowhere in his complaint is race or discrimination mentioned. The material in evidence shows that the BBB contacted Ms. Montgomery about the complaint, but marked it "information only," and did not pursue it at that time.5/ In early April 2007, Mr. Smith telephoned Ed Carr, Executive Director of the Hernando County Association of Realtors (HCAR). Mr. Smith said nothing to Mr. Carr about racial discrimination at that point, but said only that he wanted to get out of the listing contract with Respondent. On or about April 23, 2007, Petitioners filed a formal complaint with HCAR. HCAR's Grievance Committee met May 7, 2007, and, apparently in the mode of a probable cause panel, referred the case for a full evidentiary hearing. On June 29, 2007, the case was first noticed for hearing by HCAR. Petitioners’ HCAR complaint is not in evidence, and the evidence herein falls short of enabling the undersigned to determine whether the complaint before HCAR involved racial discrimination. However, it is certain that Ms. Montgomery perceived it that way. The HCAR hearing was first scheduled to occur August 28, 2007, but it was re-scheduled. The actual date the hearing took place and the date HCAR issued its decision are not clear in this record, but the hearing was on or after October 23, 2007. Mr. Van Slyke presided over the HCAR hearing. The HCAR decision resulted in a determination that Respondent had not violated professional real estate ethics. Despite Petitioners’ expressed dissatisfaction with HCAR's result and their claims that HCAR’s panel was prejudiced in Respondent's favor and that Respondent manipulated timing of the hearing, the HCAR process, and its deciding body, there is no competent, credible, or compelling evidence herein demonstrating the validity of such accusations or demonstrating that HCAR’s decision in Respondent’s favor was based on racial discrimination or constituted a cover-up for racial discrimination. That said, HCAR's decision is not binding here. Ms. Montgomery testified credibly that she had refused to acquiesce in any overt action, such as voluntarily letting Petitioners out of their contract without paying her commission, because to do so might make her appear to be prejudiced. Even more credible is her testimony that she did not want to let Petitioners out of their listing contract unless they paid her commission and costs, as provided in the contract, because she had already expended considerable time and money on Petitioners' behalf. Respondent continued to advertise the Cressida Circle house until the end of the eight-month contract (see Findings of Fact 19 and 40), despite Petitioners’ refusal to allow Respondent to reduce the asking price. Unfortunately, between June 14, and July 1, 2007, Respondent advertised an incorrect and lower asking price of $269,900.000, in "Nature Coast." Respondent did not know how the error occurred. The advertising for this two-week period was, as always, at Respondent's expense, and the asking price was corrected in the next issue. While signed-up with Respondent, Mrs. Smith took material prepared by Respondent for marketing the Cressida Circle property, made minor adjustments to it, and placed it on her own and others' websites. The material she posted sometimes carried Ms. Hobbs' contact information. Other times, Mrs. Smith's internet advertisements showed a reduced price for contacting Petitioners. This placed Petitioners in direct competition with Respondent's advertisements in which Petitioners required that Respondent maintain the original $296,900.00, asking price. In so-doing, Petitioners may have offended a clause of the listing contract. In placing this information on MLS websites outside of Respondent’s general geographic area, Petitioners may have exposed Respondent to liability in the professional real estate community. Respondent advised Petitioners of these problems, but there is no clear evidence that Respondent intervened to prevent Petitioners' behavior. Petitioners moved into their new, Rudolph Court house in early June 2007. When they moved, their furniture and photographs went with them. Photographic evidence shows that Petitioners allowed the Cressida Circle house to deteriorate after they moved to Rudolph Court, thereby rendering the sale property less desirable to potential buyers. Petitioners each testified credibly that between January 31, 2007, and the time they moved out, probably about June 6, 2007, Respondent gave them no advance notices that a potential buyer was coming to view the Cressida Circle house, as had been agreed upon when the house was listed. The sign-in sheet left in Petitioners’ sale house demonstrated that Exit Realty showed the house once, on August 21, 2007. Petitioners acknowledged that the home was also shown another time on the day before Caravan Day. (See Finding of Fact 22.) Respondent produced her lock-box's recorded printout showing that on February 1, 2007, Ms. Hobbs entered the house. (See Finding of Fact 17.) It shows also that Ms Hobbs entered again on June 7, 2007. On July 17, a ReMax salesman entered. On July 27, Respondent entered. On July 31, an ERA saleswoman entered. On August 10, and 11, Respondent entered. On August 21, another Exit Realty saleswoman entered. (See Finding of Fact 55.) On September 20, Clara Ward, an independent contractor with Exit Realty entered. (See Finding of Fact 58.) On October 4, 2007, Ms. Hobbs entered. Respondent acknowledged that on one or two of the foregoing occasions, she entered the sale house, not to show the property to prospective buyers, but to take photographs for the HCAR hearing (see Finding of Fact 47), but there is no credible evidence to support Petitioners' conjecture that the other visits by Ms. Montgomery and by all other real estate salespersons were not for the purposes of showing the house or for some other legitimate sales purpose. Clara Ward testified that she showed the house to a legitimate potential buyer about a month before Respondent's listing ended, and again in approximately December 2007, after Petitioners had listed it with another realtor at the reduced price of $256,900.00. Mr. Smith admitted that he never asked Ms. Hobbs for an "open house," until June 2007. The contract does not require an "open house." Ms. Montgomery testified credibly and without refutation that she did not schedule an "open house" for Petitioners because, in the past, "open houses" have not resulted in sales for her. She rarely, if ever, utilizes them for any property. Mr. Smith admitted that Petitioners had no evidence to support their allegation that every other home that Exit Realty signed in the same period was shown more than once. Petitioners also presented no evidence that every other home, besides the Cressida Circle home, which Exit Realty signed in the same period held even one open house.6/ In November 2007, Petitioners signed with another realtor who marketed the house at $269,900.00, which was $27,000.00 less than the only figure at which Petitioners would permit Respondent to market the house. If and when there was a sale is unclear.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations enter a final order dismissing the Complaint and the Petition for Relief. DONE AND ENTERED this 19th day of September, 2008, in Tallahassee, Leon County, Florida. S ELLA JANE P. DAVIS 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 19th day of September, 2008.
The Issue Whether Respondent committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, or breach of trust in any business transaction as alleged in the Administrative Complaint in violation of Subsection 475.25(1)(b), Florida Statutes (2006).1
Findings Of Fact Petitioner is the state agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Section 20.165 and Chapters 120, 455 and 457, Florida Statutes. Petitioner has jurisdiction over disciplinary proceedings before the Florida Real Estate Commission (FREC) and is authorized to prosecute administrative complaints against licensees within FREC’s jurisdiction. At all times material, Respondent was a licensed Florida real estate broker, license number 684990, under Chapter 475, Florida Statutes. The last license issued to Respondent was as a broker at Florida’s Best Buy Realty & Mortgage Lender, LLC, Post Office Box 551, Winter Park, Florida 32793. On or about February 15, 2007, Respondent entered into a contract to manage the single-family dwelling owned by Jacqueline Danzer. The property is located at 2979 Krista Key Circle, Orlando, Florida 32817 (Subject Property). The agreement was for the period February 15, 2007, until February 15, 2008. Respondent was authorized, under the management agreement, to seek a tenant for the property. Said management agreement authorized Respondent to be compensated at the rate of 10 percent of the rent due during each rental period. On or about March 27, 2007, Respondent negotiated a lease agreement with Veronica Valcarcel to rent the Subject Propery. The tenant applied through the federal Section 8 program, administered by the Orange County Housing and Community Development Division (Agency), for rental assistance in order to rent the Subject Property. Section 8 assists low-income families with their rent. A tenant who qualifies for Section 8 assistance is prohibited from paying more than 40 percent of his or her income for rent and utilities. On April 26, 2007, Respondent, acting on behalf of the landlord for the Subject Property, entered into and signed a “Housing Assistance Payment Contract” or “HAP” contract with the Agency as part of the Section 8 program. The HAP contract provided that for the initial lease term for the Subject Property (for the period April 1, 2007, until March 31, 2008), the initial monthly rent was $1,150 per month. This was determined to be the maximum payment the tenant could pay without exceeding 40 percent of her income. The HAP contract explicitly provides in its terms that “[d]uring the initial lease term, the owner may not raise the rent to tenant.” Respondent knew that he was prohibited from charging more than the monthly rent stated in the HAP contract. Respondent has had experience in the past with other tenants who participated in the Section 8 program. Respondent has previously signed other HAP contracts which contained the same restrictive language. Under the lease contract that the tenant Veronica Valcarcel signed with the property owner Jacqueline Danzer, the monthly rent would be $1,150 per month. The signature page in the lease contract is not the same page on which the monthly rental amount is written. The property owner Jacqueline Danzer asserts that the initials in the lease contract reflecting a monthly rental of $1,150 were not all her initials. Under the terms of the Exclusive Property Management Agreement, Respondent was being compensated at the rate of 10 percent per month after the first month. A monthly rental amount of $1,500 indicates that the property owner would receive a net of $1,350 per month. The property management agreement provided that Respondent would make payments to the property owner by direct deposit. The property management agreement lists a 12-digit bank account number, with the last four digits of “6034,” into which Respondent was to make direct deposits. At the hearing, property owner Jacqueline Danzer testified that she had received payments from Respondent for the Subject Property to her Bank of America savings account, with the account number ending in “6034.” The last four digits of the account number on the Bank of America Statement match the last four digits on the account number found on the Property Management Agreement. According to the Bank of America records, Respondent made the following payments to the property owner: a) $1,550 on May 9, 2007 b) $1,000 on May 9, 2007 c) $850 on June 12, 2007 d) $1,350 on July 11, 2007 e) $1,350 on September 10, 2007 On September 12, 2007, property owner, Jacqueline Danzer went to see Lois Henry, the manager of the Section 8 department for the Agency. During the course of that meeting, Dnazer advised that Respondent was collecting $1,500 a month rent from the tenant instead of $1,150 a month. On September 12, 2007, during the course of a telephone conference with Jacqueline Danzer and Lois Henry, Respondent admitted that he had been collecting $1,500 monthly rent for the Subject Property, retaining a commission of $150 and depositing the balance in Danzer’s account. Respondent denied making an admission during the telephone conference on September 12, 2007. He also denied that he was collecting $1,500 from the tenant, and further denied that he was violating Section 8 regulations. Respondent’s testimony is not credible. The witness Danzer’s testimony is credible. Petitioner has proven by clear and convincing evidence that Respondent violated the Housing Assistance Payments Contract. The total amount of investigative costs for the Petitioner for this case, not including attorney’s time, were $874.50.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Florida Real Estate Commission, enter a final order: Finding Respondent guilty of violating Subsection 475.25(1)(b), Florida Statutes; Revoking Respondent’s license, and imposing an administrative fine of $1,000.00; and Requiring Respondent pay fees and costs related to the investigation in the amount of $874.50. DONE AND ENTERED this 26th day of August, 2009, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE 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 26th day of August, 2009.
The Issue In relation to DOAH Case No. 05-0515, does the case involve the sale of securities as described in Chapter 517, Florida Statutes (2002), that would confer jurisdiction upon OFR to proceed to a hearing on the merits of the Administrative Complaint that forms the basis for DOAH Case No. 05-0515, and to what extent, if any, the named Respondents have been involved with the sale of securities sufficient to declare jurisdiction over their activities? Preliminary to that determination is the related issue concerning the possible pre-emption of OFR's regulatory authority by virtue of the regulatory action previously taken by the State of Florida, Department of Business and Professional Regulation, Division of Land Sales, Condominiums and Mobile Homes (DBPR) under authority set forth in Chapter 721, Florida Statutes (2002)? Argument has also been set forth concerning the significance of court cases as they might influence OFR's ability to declare their regulatory authority in this instance.
Findings Of Fact * * * 2. RESPONDENT is the 'creating developer' of the Universal Luxury Lease Plan, a personal property 'timeshare plan' as those terms are defined in sections 721.05(9)(a) and 721.05(37), Florida Statutes, located in the city of Sanford, Florida. * * * On or about July 10, 2003, DIVISION was made aware of a newspaper advertisement for Universal Luxury Lease Plan. This advertisement, promoted the purchase of a timeshare interest in the Universal Luxury Lease Plan as an investment that offered purchasers a 10 percent per year return on their investment. On July 25, 2003, DIVISION'S investigators were given an application package containing the Universal Luxury Lease Plan Enrollment Forms, CD-ROM, Public Offering Statement, Contracts and Motor Coach Brochures. The application package stated that it was advertising material being used for the purposes of soliciting timeshare interests. It described a component of the timeshare plan called the 'Affinity Rental Program' and stated that the program will typically produce a monthly income of 10 percent of the lease-hold ownership interest.
Recommendation Based upon the consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That an order be entered by OFR finding jurisdiction to proceed with the Administrative Complaint in DOAH Case No. 05- 0515 on its merits. DONE AND ENTERED this 6th day of January, 2006, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 6th day of January, 2006.
