Findings Of Fact Notices to Show Cause were issued by the Department against Roy D. Mathew, and William Gannaway on April 9, 1976. (See: Agency Exhibits 1 and 2). The final hearing was scheduled by notice dated May 12, 1976. (See: Agency Exhibit 3). Roy D. Mathew, d/b/a Anchorline Yacht Brokerage holds Yacht and Ship Broker License No. 12433, issued by the Department on December 18, 1975. (See: Agency Exhibit 5). Mathew has at all material times held a yacht and ship broker license issued by the Department. William G. Gannaway holds Yacht and Ship Salesman License No. 12657, issued by the Department on December 18, 1975. (See: Agency Exhibit 4). Gannaway has at all material times held a yacht and ship salesman license issued by the Department. Gannaway has at all material times served as a yacht and ship salesman for Roy D. Mathew and Anchorline Yacht Brokerage. Prior to July, 1975, R. A. McKenzie, the owner of a yacht called The Anokone, decided to sell the yacht. The yacht was housed at Anchorline Yacht Brokerage in St. Petersburg, Florida, and McKenzie agreed to pay Anchorline a commission for selling the yacht. On or about July 8, 1975, Jean C. Noll, a resident of Jacksonville, Florida, saw the yacht, and believed that it was the sort of vessel that she and her husband had been looking for. She entered into a purchase agreement with the understanding that her husband, the Reverend Joseph E. Noll, Jr., would have the opportunity to make a personal inspection. William G. Gannaway represented Anchorline Yacht Brokerage in the transaction, and received a deposit from Mrs. Noll. (See: Agency Exhibit 6). On or about July 15, 1975 Reverend Noll came to St. Petersburg from Jacksonville and inspected the yacht. Gannaway at that time advised Reverend Noll that the starboard engine on the yacht was broken down and would require extensive repairs. Reverend Noll liked the yacht, and hired the Wilkinson Company to conduct a survey of the yacht. Dean Greger conducted the survey on behalf of the Wilkinson Company. A very thorough inspection was performed by Greger. He made 24 recommendations respecting & repairs, some of which were significant, and some of which were minor. He was not able to conduct a sea test of the vessel because of the broken down engine. His report was issued on July 22, 1975. (See: Agency Exhibit 7). McKenzie was somewhat disturbed about the large number of discrepancies, and he offered the following alternatives to the Nolls: He would sell the boat "as is" for $15,000; he would sell the boat "as is" with a new starboard engine installed for $17,000; or he would sell the boat for $19,500 with a new engine, with him making all additional repairs up to $1,000 and with all remaining repairs being split evenly three ways between the Nolls, McKenzie, and Anchorline. The Nolls accepted the latter option, and a contract reflecting it was signed. (See: Agency Exhibit 28). All work was to be performed at Whistlers Yacht Service, Inc., which was located adjacent to Anchorline. Shortly after July 22, 1975, it became apparent that a new replacement starboard engine could not be obtained, because the engine was no longer in production. Gannaway advised the Nolls that Whistlers indicated to him that they could replace the "shortblock" of the engine, rebuild the engine, and that they would stand by their work. Gannaway told the Nolls that he thought the rebuilt engine would carry a one year guarantee. Reverend Noll believed that the guarantee would be for no more than 90 days, and he agreed to a rebuilt engine rather than a new engine. Extensive work was performed by Whistlers Marina, and more than $2,100 was paid to Whistlers to perform the repairs. (See: Agency Exhibits 14, 22, 23, 24, 25). Dean Greger conducted a supplemental survey, including a sea test of the vessel on or about August 14, 1975. Fourteen of the 24 discrepancies noted in the original report were found to have been satisfactorily corrected. It was noted that the generator, the depth sounder, the auto pilot, the signal horn, the marine air conditioning, and the docking lights were not performing properly. (See: Agency Exhibit 8). The Nolls were aware of these problems when they closed the transaction and purchased the yacht on approximately August 20, 1975. The closing took place at a Federal Credit Union in Jacksonville. No representative of Anchorline was present at the closing. Following the closing the Nolls took possession of the yacht, and renamed it "Escape Hatch II". The Nolls were advised by several persons, including personnel at Whistlers Yacht Basin, and personnel at Anchorline, that they should familiarize themselves with the vessel in the immediate area prior to their taking any long excursions. The Nolls nonetheless left St. Petersburg in early September to return to Jacksonville. On this return trip the Nolls experienced many mechanical difficulties. Major repairs needed to be performed on the vessel in Ft. Myers (See: Agency Exhibit II), and minor repairs were performed in Stuart and Melbourne (See: Agency Exhibits 12 and 13). Upon return to Jacksonville major repairs were required and are continuing to be performed. (See: Agency Exhibits 16, 17, and 27). It is apparent that the starboard engine was not properly repaired, and that considerable dry rot remained on the vessel. The Nolls are presently engaged in litigation respecting their liabilities in connection with the vessel. Whistlers disclaimed any liability for making repairs, but Mrs. Coe, the general manager at Whistlers testified that she would have performed any repairs within 90 days if the vessel had been returned to the yacht basin. Mr. Gannaway and Mr. Mathew had sound reason to believe that there were no discrepancies respecting the operability of the yacht other than those set out in the marine surveys. Mathew and Gannaway had sound reason to believe that all of the repairs required to rectify these discrepancies had been performed at Whistlers. There was no evidence offered to show that either Gannaway or Mathew intentionally misstated any facts to the Nolls, or that they knew or should have known that any statements they made to the Nolls were false. There was no evidence to establish that Mathew had any personal knowledge of any of the dealings or discussions between Gannaway and the Nolls.
The Issue The issue is whether Respondent, a Florida-licensed yacht salesman, should be disciplined for violation of Rule 61B- 60.006(2), Florida Administrative Code, as alleged in the Administrative Complaint dated May 10, 2000.
Findings Of Fact At all times pertinent to the issues herein, DBPR, through its Division of Florida Land Sales, Condominiums and Mobile Homes (the Division) was the state agency in Florida responsible for the licensing and discipline of yacht salespersons and brokers in this state and the regulation of the yacht-brokering profession. Respondent, Justo Lamar (Lamar), has been licensed as a yacht salesperson since November 1976. Prior to this action, Lamar has never been the subject of disciplinary action arising out of the practice of his profession. This action was precipitated by a yacht owner, Juan A. Galan (Galan), who unsuccessfully attempted to sell his yacht to a client of Lamar's. In July 1998, Galan listed his yacht, the Caliente, for sale through Ardell Yacht and Ship Brokers (Ardell). The listing resulted in negotiations for the purchase of the Caliente by one Larry Griggs (Griggs), a prospective customer represented by Lamar. At all times relevant to this case, Lamar was acting as a sales agent for Allied Marine and its broker, Dwight Tracy (Tracy). As set forth in more detail below, the negotiations between Galan and Griggs took place over a three-month period from October 1998 through December 1998 with no meeting of the minds. On July 12, 1999, some seven months after negotiations between Griggs and Galan terminated, Galan lodged a complaint with DBPR. Although the complaint was ostensibly directed against salesman Lamar and broker Tracy, each and every allegation in the complaint was directed to the broker's conduct, not Lamar's. Galan, who did not testify at final hearing, alleged in his complaint that "Broker presented a contract representing that deposit had been received/deposited (upon acceptance). In fact, broker never deposited check and we wasted our time and money on survey/sea trial as buyer was not (at that time or any time later) financially capable of buying boat @ $1.75 million." Galan provided some, but by no means all, of the documents which revealed the details of the prolonged and ultimately unsuccessful negotiations between Galan and Griggs. In the narrative portion of his complaint, Galan asserted that he lost money on sea trials and implied, without actually stating, that the Caliente had been taken off the market during the pendency of negotiations with Griggs. For reasons which remain unclear, the Division did not focus its investigation on Tracy, who was the obvious target of Galan's complaint. Instead, it targeted Lamar, who was an obvious add-on target of Galan's ire. The exhibits reveal a complex series of offers and counteroffers and jockeying for negotiating advantage, not just between Galan and Griggs as prospective Seller and Buyer of the Caliente, but also between Lamar and the two brokers, all three of whom stood to profit if the transaction were consummated. Negotiations for the Caliente began in late October 1998. On October 30, 1998, Lamar's client Griggs, through a corporation he controlled, issued a $150,000 check for "Deposit, 72' (sic) Caliente Sportfisherman." This check accompanied a Brokerage Purchase and Sale Agreement dated October 29, 1998, offering to purchase the Caliente for $1,500,000. That same day, Galan's representatives faxed Lamar to advise that Griggs' offer was insufficient. Lamar forthwith provided the check to his broker, Tracy. Negotiations between Galan and Griggs continued in November. Galan chose to by-pass his own Broker and negotiate directly with Lamar over lunch on November 18, 1998. Lamar wrote Galan's demands on the back of a restaurant placemat. The primary sticking point was Galan's insistence on a "bottom line" of $1,665,000 to him, after all commissions and other expenses, if any, were paid. Griggs nevertheless persevered in his effort to buy the Caliente for $1,500,000. On November 24, 2000, Griggs executed another Brokerage Purchase and Sale Agreement in which he offered an entity called Majua, Inc., of which Galan was President, the opportunity to sell the Caliente to Griggs for $1,500,000. Galan signed the November 24 agreement, but added an addendum which materially changed the terms. The addendum unilaterally purported to raise the sales prices to Galan's previously stated "bottom line" of $1,665,000. Thanksgiving passed, and negotiations wore on. On December 4, 1998, Griggs executed a third Brokerage Purchase and Sale Agreement, raising his offer to $1,755,000. The new offer expressly stipulated that Griggs' $150,000 earnest money check could be deposited when and if all parties executed this new proposed agreement. Like the October 29 and November 24 brokerage purchase and sale agreements, the December 4 document never ripened into a contract. The December 4 document was a clear and unembarrassed reminder from Griggs that an earnest money check had been written by Griggs, but was not on deposit, and was not going to be on deposit until such time as Galan had signed off on the contract as written by Griggs. Galan nevertheless permitted a sea trial of the Caliente in furtherance of negotiations, now in their fifth week. Also as part of the negotiating process, Galan permitted some, but not all, of the inspections requested by Griggs. Expenses for the sea trial and inspections were borne entirely by Griggs. By Christmas Eve, relations between the parties had deteriorated to the point where Lamar retrieved the check from the Allied Marine corporate files and returned it to Griggs. At no time did negotiations with Lamar's client Griggs preclude or interfere with efforts by Galan to negotiate with and sell the Caliente to any other prospective purchaser.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that DBPR enter a final order dismissing the Administrative Complaint against Respondent. DONE AND ENTERED this 1st day of March, 2001, in Tallahassee, Leon County, Florida. FLORENCE SNYDER RIVAS 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 1st day of March, 2001.
The Issue Whether Respondent violated Sections 326.006(2)(e)1, 3, and 6 and 326.005, Florida Statutes, and if so, what penalty should be imposed.
Findings Of Fact At all times material to this action, Respondent, Richard Spooner (Spooner), was licensed by the Petitioner, Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes (Department), as a yacht salesperson. In June 1998, Spooner worked for C & S Marine, Inc., (C & S), located in Fort Lauderdale, Florida. Chris Saumsiegle, the owner of C & S, was Spooner's employing broker. In June 1998, Chris Saumsiegle was working with Angelo Dieguez, a client from South Carolina, to locate a yacht for Mr. Dieguez to purchase. Mr. Saumsiegle negotiated the purchase of a yacht for Mr. Dieguez; however, the deal was not consummated. After Mr. Saumsiegle's attempt to negotiate the purchase of the yacht for Mr. Dieguez failed, Mr. Saumsiegle put Spooner, as a salesperson for C & S, in touch with Mr. Dieguez to find him a yacht to purchase. Spooner and Mr. Dieguez discussed the purchase of a 1995, 33-foot Sea Ray yacht, and Mr. Dieguez became interested in buying the vessel. Mr. Dieguez was advised by Spooner that he was working at home while his wife recovered from surgery. Spooner drafted a Purchase Agreement, which was a C & S form agreement containing the title "C & S Marine Brokerage Purchase Agreement." Spooner crossed out the telephone and fax numbers for C & S on the form, wrote in his home fax number, and faxed the document to Mr. Dieguez for execution. The purchaser agreement contained the following paragraph: The purchase price of the Vessel is Eighty- Seven Thousand Dollars ($87,000.--) Upon signing this agreement by the PURCHASER, a deposit of Eight Thousand Seven Hundred Dollars ($8,700.--) shall be paid by the PURCHASER to (hereinafter called the BROKER) and shall be held in Escrow by the BROKER. This offer is withdrawn if not accepted by June 12, 1998. Mr. Dieguez executed the purchase agreement and returned it to Spooner by fax for Spooner to make an $87,000 offer on the yacht. The terms of the purchase agreement required Mr. Dieguez to send ten percent of the purchase price as earnest money. Pursuant to the purchase agreement, the seller had only one day to respond to the offer after Mr. Dieguez faxed the purchase agreement to Spooner. Thus, Mr. Dieguez asked Spooner where to electronic funds transfer (EFT) his earnest money. Spooner faxed Mr. Dieguez instructions to make his check out to the Boating Center of Fort Lauderdale (Boating Center), the seller's agent or the seller, and to send the funds to Boating Center. In Mr. Dieguez' previous attempt to purchase a yacht through C & S, he had been given instructions to send his deposit by EFT to C & S's escrow account. Mr. Dieguez contacted Mr. Saumsiegle and asked why he was supposed to send a check to Boating Center. Mr. Saumsiegle was unaware that Spooner was trying to sell Mr. Dieguez a boat through Boating Center and that he had directed Mr. Diequez to send a check to Boating Center. Ultimately, Mr. Dieguez did not send a deposit and did not purchase the yacht. Mr. Saumsiegle terminated Spooner's relationship with C & S Marine in July 1998. Boating Center is not a licensed yacht brokerage.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Richard Spooner violated Subsections 326.006(2)(e)1, 3, and 6, Florida Statutes; suspending his salesperson's license for two years; and imposing an administrative fine of $5,000. DONE AND ENTERED this 15th day of December, 1999, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND 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 15th day of December, 1999. COPIES FURNISHED: Philip Nowick, Director Division of Florida Land Sales, Condominiums and Mobile Homes Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 Barbara D. Auger, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 William Oglo, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 Richard J. Zaden, Esquire Zaden & Wardell, P.A. 1749 Northeast 26th Street, Suite 200 Fort Lauderdale, Florida 33305
Findings Of Fact Based upon the testimony and exhibits in evidence, and the observed candor and demeanor of the witnesses, the following are found as facts: The Respondent John J. Piccione, is a licensed real estate broker, having been issued license No. DK006911. The Respondent John J. Piccione, Inc., is a corporate real estate broker, having been issued license No. CW0069127. The Respondent Theresa M. Harris, is a licensed real estate salesperson having been issued license No. FL0331486. At all times material to the issues in the Administrative Complaint, the Respondent Theresa M. Harris was a licensed salesperson with the Respondent John J. Piccione Real Estate, Inc., under the brokerage license of the Respondent John J. Piccione. Theresa M. Harris was the listing and selling salesperson in connection with a real estate transaction between Wilbur J. Hamilton, Jr., as seller, and Mr. and Mrs. James Smith, as buyers. This transaction was closed on December 16, 1980, in Ocala, Florida. The closing was held in the offices of American Mortgage Funding Corporation, and was conducted by Thomas G. Sawaya, Esquire, as Closing Attorney. Present at the closing were the seller, Mr. Hamilton, the buyers, Mr. and Mrs. Smith, the Respondent, Theresa M. Harris, and Charles DeMenzes, President of American Mortgage Funding Corporation. Prior to the time the Contract for Sale was executed by the seller and the buyers, the Respondent Harris was informed by a party named Mr. Alsobrook that he claimed an interest in the proceeds from the sale on the subject property. The seller acknowledged that Mr. Alsobrook was entitled to a share of the proceeds. After the contract was signed, but before closing, the Respondent Harris was contacted on two more occasions by Mr. Alsobrook concerning his interest in the proceeds of the sale. On December 15, 1980, before the closing occurred, a Civil Complaint was filed against the seller in the Circuit Court of Marion County by Mr. Alsobrook regarding Mr. Alsobrook's interest in the property and the proceeds. In connection with this lawsuit a Lis Pendens was delivered to the Office of the Clerk of the Circuit Court on December 15, 1980, but was not filed in the Official Records Book of Marion County until December 17, 1980, in O.R. Book 1046, page 116, after the Deed from Mr. Hamilton to Mr. and Mrs. Smith had been recorded in O.R. Book 1046, page 73. On December 15, 1980, the day before, the closing, Robert Duggan, who is Mr. Alsobrook's attorney had a telephone conversation with the Respondent Harris, in which he informed her that a lawsuit had been filed concerning Mr. Alsobrook's interest in the proceeds of the sale, and that a Lis Pendens had been or was going to be filed against the property. This attorney requested that the closing be delayed until the dispute concerning the property could be resolved. On December 16, 1980, before the closing, the Respondent Harris conveyed to the Respondent Piccione, her broker, the contents of her conversation with Mr. Alsobrook's attorney. The Respondent Harris was instructed by the Respondent Piccione to attend the closing and not to mention either the call from Attorney Duggan, or the pending lawsuit, or the Lis Pendens, unless someone else brought these matters up. At no time during the closing or prior to the closing did the Respondent Harris make known to the buyers, the lender, or the closing Attorney, the facts known to her regarding the call from Attorney Duggan, the pending lawsuit, or that a Lis Pendens had been or would be filed against the property. The Respondent Piccione was aware of the fact that a Lis Pendens had been or was going to be filed against the property, but he instructed his salesperson, Respondent Harris, to withhold this information from the parties to the sales transaction at the time of closing. The closing was completed and the lender, without knowledge of the pending suit and Lis Pendens, disbursed the net proceeds of $15,728.24 to Mr. Hamilton as the seller. The closing Attorney and the lender were informed of the Lis Pendens and the pending suit by the attorney for Mr. Alsobrook the day after the closing took place. Upon being informed of the pending lawsuit, the lender contacted the seller, who agreed to return the proceeds to the lender The lawsuit was subsequently dismissed and the Lis Pendens discharged upon distribution of the net sale proceeds to Mr. Alsobrook in the amount of $6,385.19 and to Mr. Hamilton in the amount of $9,393.05. The Respondents received a commission of $1,500 which was paid $900 to Mrs. Harris and $600 to Piccione Real Estate, Inc.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Respondent, Theresa M. Harris, be found guilty of violating Section 475.25(1)(b), Florida Statutes, and that her license be suspended for one year. It is further RECOMMENDED that the Respondents, John J. Piccione and John J. Piccione Realty, Inc., be found guilty of violating Section 475.25(1)(b), Florida Statutes, and that their licenses be suspended for one year. THIS RECOMMENDED ORDER entered on this 27 day of September, 1982. WILLIAM B. THOMAS, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27 day of September, 1982.
The Issue The issue in this case is whether Respondents are guilty of mishandling an escrow deposit.
Findings Of Fact Respondent Vu is and was at all material times a licensed real estate broker, holding Florida license number 0394778. He is and was at all material times the qualifying broker for Respondent American Homes and Investment Realty, Inc., which holds Florida license number 0250718. Respondent Vu owns Respondent American Homes. In 1990, Mr. and Mrs. Serge Delisfort contacted Respondents about purchasing a residence. The Delisforts eventually signed a contract to purchase a home and paid the $500 earnest money deposit to Respondents. Later learning that they would be liable to pay an annual homeowners' fee of $72, the Delisforts told Respondent Vu that they did not want to complete the purchase. The listing broker, which was not either Respondent, omitted mention of the homeowners' fee from the listing information supplied Respondents and the Delisforts. The sellers refused to release the deposit. Confronted with the dispute, Respondent Vu promptly requested an escrow disbursement order from the Florida Real Estate Commission on March 29, 1991. Due to the presence of a factual or legal dispute, the Florida Real Estate Commission informed Respondents, in a 47-word letter dated October 16, 1991, that it could not issue an escrow disbursement order. The October 16 letter warns Respondents to "immediately choose one of the other two alternatives available to you under ss. 475.25(1)(d), Florida Statutes, to settle this dispute, i.e., arbitration or a civil court." Instead, Respondents did nothing. The Delisforts periodically contacted Respondent Vu and asked if he could release their deposit. The sellers sold their house to another party and moved to Puerto Rico. The Delisforts contacted another broker and purchased a different house through the new broker. Eventually, the Delisforts contacted the Florida Real Estate Commission and asked its help in obtaining the deposit. An investigator for the Division of Real Estate interviewed Respondent Vu on March 1, 1994. Explaining the reason for the delay, Respondent Vu, possibly confused, stated that the buyers had left Orlando for awhile. In fact, the buyers had remained in Orlando. At the suggestion of the investigator, Respondent Vu contacted both parties, and they agreed to split the deposit equally. Respondent Vu prepared the paperwork, which the parties signed on March 11, 1994. At that time, Respondents paid each party $250. The Delisforts have since listed their home for sale by Respondents. While improperly holding the $500 deposit, Respondent Vu was preoccupied by the illnesses and deaths of his parents, who remained in Vietnam. Despite the possibility of trouble upon his return to Vietnam, Respondent Vu traveled to Vietnam at least once during this time to care for one or both of his parents. Respondents failed to implement timely the remedies established by law and identified by the Florida Real Estate Commission in its letter of October 26, 1991. Respondent Vu acted two and one-half years later, only after one of Petitioner's investigators contacted him. It is no excuse that the costs of arbitration or court would have consumed a large part of the amount in dispute. Confronted with that prospect, the sellers or the Delisforts would probably have settled the matter. If not, that would have been their problem, not Respondents'. The fact is that Respondents failed to discharge their obligations by presenting the dispute for resolution in a timely fashion. Nonetheless, the amount involved is modest. Neither party had a clear claim to the funds, nor was either party exceptionally troubled by Respondents' casual handling of the matter. The Delisforts contacted the Florida Real Estate Commission, but did not realize that they were in effect filing a complaint against Respondents, in whom they entrusted the sale of their current home. A final order issued July 18, 1988, involves Respondents' mishandling of a salesperson's commission. The husband of the salesperson owed Respondent Vu some money, and both men agreed that the debtor's wife would work off the debt by selling real estate at Respondent American Homes. However, the debtor's wife was of a different mind. After earning her first commission, she refused to allow Respondents to credit it against her husband's debt. When Respondent Vu ignored her demand for payment, she filed a complaint, which resulted in the final order and Respondents' proper payment of the commission.
Recommendation It is hereby RECOMMENDED that the Florida Real Estate Commission enter a final order finding both Respondents guilty of violating Section 475.25((1)(d)1, reprimanding both Respondents, and requiring Respondent Vu to take a thirty-hour broker management course. ENTERED on February 22, 1995, in Tallahassee, Florida. ROBERT E. MEALE 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 on February 22, 1995. COPIES FURNISHED: Darlene F. Keller Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, FL 32802-1900 Steven W. Johnson, Senior Attorney Department of Business and Professional Regulation Division of Real Estate Legal Section--Suite N-308 Hurston Bldg., North Tower 400 West Robinson Street Orlando, FL 32802-1772 Dau Viet Vu 1048 Pine Hills Rd. Orlando, FL 32808
Findings Of Fact On July 17, 1989, Petitioner, Paul Shimek filed an application for licensure as a real estate salesman. Question 8(b) of the application inquired as to whether there was any case pending against the applicant in any court, including any appellate court, in which the applicant was charged in any pleading with any fraudulent or dishonest dealing. The Petitioner responded in the affirmative to Question 8(b) of the application and stated that he expected "resolution in 1989 favorably." Mr. Shimek attached the appropriate documents to his response to support his affirmative answer. Question 15(a) of the application inquired as to whether any license, registration or permit to practice any regulated profession, occupation or vocation of the applicant had been revoked, annulled or suspended in this or any other state, province, district, territory, possession or nation upon grounds of fraudulent or dishonest dealing or violations of law, or was any proceeding now pending. The Petitioner answered in the affirmative to Question 15(a) of the application and stated "[the case] was pending but expect to resolve. Not sure of question." The Petitioner attached a photocopy of his Petition to Resign [from the Florida Bar] Without Leave to Reapply (Petition to Resign), TBF File No. 89-00876-NRS-01A which he filed with the Florida Supreme Court on or about July 7, 1989. Question 15(b) inquired as to whether the applicant had ever resigned, withdrawn from, or surrendered, any license, registration or permit to practice any regulated profession, occupation or vocation while such charges were pending. The Petitioner answered in the affirmative to Question 15(b) of the application and stated that he would "continue to practice until vindicated." Petitioner, Paul Shimek, was a practicing attorney in the State of Florida for 26 years. He voluntarily resigned from the Florida Bar without the ability to reapply for re of practice, Mr. Shimek was on the cutting edge of litigation and public interest law. His resignation from the Bar was prompted by two separate and unrelated complaints to the Florida Bar which Mr. Shimek did not want to taint his son's on-going practice in their law firm in Pensacola, Florida. One complaint was filed by Brenda Skipper, a former client of Petitioner. 1/ The second complaint was filed by Melvin Pierce. Mr. Pierce had never been Petitioner's client. 2/ Both people have since sued Mr. Shimek in court. The Skipper case, is filed in the circuit court for Escambia County, Florida. The Pierce case, is filed in the Circuit Court of Mobile County, Alabama. Both suits alleged misrepresentation and mishandling of funds held by Mr. Shimek in his attorney's trust account and are the same facts which caused Mr. Shimek to resign from the Bar. Both of these suits remain unresolved to date. In early 1988, Mr. Shimek had represented Mr. and Mrs. Skipper in a law suit involving an automobile accident. The litigation was settled for a total of $112,148.36. However, during the pendency of their personal injury litigation, the Skippers became embroiled in a highly contested dissolution of marriage action. Mr. Shimek received contrary instructions from Mr. and Ms. Skipper regarding distribution of the settlement proceeds. Therefore, until the circuit court dealt with the settlement proceeds in the dissolution of marriage action, Mr. Shimek was unable to distribute the judgment proceeds to either of the Skippers. The settlement proceeds were placed in Mr. Shimek's trust account for later distribution to the Skippers. While awaiting a Circuit court order dealing with the settlement proceeds and believing Mrs. Skipper had authorized him to invest her portion of the settlement proceeds in a certificate of deposit. Mr. Shimek purchased an international two year $87,000 certificate of deposit bearing nine percent interest from the Joseph's First International Bank Limited, located in the colony of Montserrat, West Indies. 3/ The interest rate was the highest he could obtain on behalf of his client. The CD was issued in Brenda Skipper's name and was transferred to her on December 6, 1988 as part of the settlement proceeds. The CD matures on December 5, 1990. The remaining settlement proceeds in the law firm's trust account were also distributed on December 6, 1988, to Ms. Skipper. A full accounting for the distribution was made by Petitioner in a letter of the same date. The CD on its face appears to be valid and properly issued. However there was some indication in the testimony that the CD was invalid since it was not signed by the person in the bank who had authority to issue and sign such CD's. Therefore, the CD may not be paid when the time for its payment arrives. Mr. Shimek had no knowledge which would have led him to believe that the CD was not properly issued or that it might not be honored at its maturity. Brenda Skipper has sued Mr. Shimek over his purchase of the CD and has alleged in her complaint that he was not authorized to purchase such a CD. However, on this record, it is clear that Mr. Shimek believed he had the authority to purchase a CD on Mrs. Skipper's behalf. None of these facts involving Mrs. Skipper demonstrate a lack of moral character on Mr. Shimek's part or demonstrate that he is not otherwise truthful, honest, trustworthy and known for fair dealing. Likewise, these facts do not demostrate that Mr. Shimek would be a danger to the real estate clients he may serve. The Skipper case simply demonstrates a misunderstanding between an attorney and his client on how to handle settlement proceeds pending a final distribution. In mid to late 1988, Mr. Shimek received a call from a long-time client of his named Pat Kline. She instructed Mr. Shimek that Melvin Pierce would be wiring $55,000 into his trust account. Mr. Shimek believed that the funds were being paid to Ms. Kline in some investment deal she had going with Mr. Pierce. The funds were wired directly to Mr. Shimek's trust account without any instructions from Mr. Pierce. Mr. Shimek disbursed the funds supplied by Mr. Pierce upon the instructions of Ms. Kline. All of the money was disbursed to a Mr. Kennedy for the expenses he was incurring in attempting to close a large financial transaction from which Mr. Kline was to receive the return of his initial investment of $55,000 plus $75,000 profit. The large financial transaction which Mr. Kennedy was attempting to close failed to close. It failed primarily because the participants discovered that it was an investment scam being perpetrated by a Dr. Feingold in California. Mr. Pierce then decided that he wanted his money back from Mr. Shimek and has sued him in circuit court in Alabama alleging that he mishandled his trust funds. However, at no time did Mr. Shimek ever receive any instructions from Mr. Pierce or have any contact with Mr. Pierce prior to being sued by him. He always legitimately believed that the $55,000 had been wired to him and were the funds of Ms. Kline. None of the facts relating to the incident involving Mr. Pierce demonstrate any lack of moral character, truthfulness, honesty, trustworthiness or reputation for fair dealing on the part of Mr. Shimek. Likewise, the facts do not support a conclusion that Mr. Shimek would be a danger to the real estate clients he may serve. As indicated earlier both Mrs. Skipper and Mr. Pierce complained to the Florida Bar about Mr. Shimek's handling of his law firm's trust account. Mr. Shimek was the only authorized signature on the law firm's trust account. The complaints prompted an audit of the law firm's trust account. The audit revealed a deficit of $55,000 in the firm's trust account. The deficit was caused by the Bar auditors insisting that the $87,000 certificate of deposit should be reflected in the firm's trust account. Since the CD was in Brenda Skipper's name, Mr. Shimek disagreed with the Bar auditors and did not reflect the $87,000 CD in that trust account. Because there was, at the time of the audit, undistributed attorney's fees in the trust account, the deficit in firm's trust account did not total $87,000 but was only $55,000. It is clear that the dispute over how to account for Mrs. Skipper's certificate of deposit does not amount and does not support a finding of bad moral character on the part of Mr. Shimek or that he would be a danger to the real estate clients he may serve. It is simply an accounting dispute between him and the Bar. Mr. Shimek never received any of the Skipper's money or Mr. Pierce's money from his trust account. With no contrary, competent evidence being submitted by the Commission, Mr. Shimek has demonstrated that he is entitled to apply for a real estate salesman's license.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is recommended that Petitioner's application for real estate licensure should be accepted. RECOMMENDED in Tallahassee, Leon County, Florida, this 27th day of November 1990. DIANE CLEAVINGER 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 27th day of November 1990. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-1533 The facts contained in paragraphs 1, 2, 6, 7, and 8 of Respondent's Proposed Findings of Fact are adopted in substance, insofar as material. The facts contained in the first sentence of paragraph 3 of Respondent's Proposed Findings of Fact are adopted. The remainder of the paragraph is subordinate. The facts contained in the first paragraph of paragraph 4, 5, and 9 are adopted. The remaining paragraphs are subordinate. Petitioner did not number his paragraphs. The numbers referenced in this appendix were assigned by the Hearing Officer beginning with the first paragraph and 4. of Petitioner's Proposed Recommended Order. The first paragraph number 1 was introductory and did not contain any facts. The facts contained in paragraphs 10 and 11 of Respondent's Proposed Findings of Fact are subordinate. The facts contained in paragraphs 2 and 10b of Petitioner's Proposed Findings of Fact are adopted. The facts contained in paragraphs 3, 5, 6a-i, 7, 8, 9, 10a, 10c-f of Petitioner's Proposed Findings of Fact are subordinate. COPIES FURNISHED: Paul Shimek, pro se 8556 Scenic Highway Pensacola, Florida 32514 Jocelyn Price, Esquire Office of the Attorney General The Capitol Tallahassee, Florida 32399-1050 Darlene F. Keller Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 =================================================================
The Issue Whether the Respondents committed the offenses alleged in the Administrative Complaint and, if so, the penalties that should be imposed.
Findings Of Fact Petitioner is the state licensing and regulatory agency charged with the responsibility and duty to regulate the practice of real estate, pursuant to the laws of the State of Florida. At all times pertinent to this proceeding, Respondent, Lynton Oliver Thomas, was a licensed real estate broker, having been issued license number 0504596 in accordance with Chapter 475, Florida Statutes. The last license issued to Respondent Thomas was as a broker-salesperson at Pagliari Realty, Inc., 323 Northeast 167 Street, North Miami Beach, Florida 33162. At all times pertinent to this proceeding, Respondent, L T Express Realty Corp., was a corporation registered as a Florida real estate broker, having been issued license number 0273473 in accordance with Chapter 475, Florida Statutes. At all times pertinent to this proceeding, Respondent Thomas was licensed and operating as qualifying broker and officer of Respondent L T Express Realty Corp. The office for this corporate entity was located at 2124 Northeast 123 Street, North Miami Beach, Florida. There was no evidence that Respondent Thomas operated his corporate entity from any other office. On May 7, 1995, Respondent Thomas, a licensed real estate broker, d/b/a L T Express Realty Corp., negotiated a contract for the sale of a house between Bruce and Ann McCormick (as sellers) and Marie S. Saintel and Carita Luc (as buyers). The buyers gave Respondent Thomas an earnest money deposit in the amount of $5,528.00. The transaction failed to close. The sellers, through their agent, attempted to make a demand upon Respondent Thomas for delivery of the earnest money deposit. The sellers' agent was unable to serve the demand on the Respondents because the Respondents had closed their offices and could not be located. Respondents had, or should have had, a good faith doubt as to the proper way to disburse the escrowed funds. Respondent Thomas, without authorization from the sellers, returned $3,000.00 of the original $5,528.00 deposit to the buyers. The balance of the earnest money deposit, in the amount of $2,528.00, has not been recovered from the Respondents. Rule 61J2-10.032(1), Florida Administrative Code, provides the procedure real estate brokers are required to follow when competing demands are made for funds that have been received in escrow or when a broker has a good faith doubt as to how escrowed funds should be disbursed. At no time did Respondents attempt to invoke those procedures. Kenneth G. Rehm, Petitioner's investigator, visited Respondent L T Express Realty Corp. and discovered that Respondent Thomas had abandoned his registered office. Respondent Thomas failed to notify Petitioner that he closed his real estate office at 2124 Northeast 123 Street, North Miami Beach, Florida.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered that finds Respondents guilty of the violations alleged in Counts I-VIII of the Administrative Complaint. As a penalty for these violations, the Final Order should revoke all licenses issued by Petitioner to Respondents. DONE AND ENTERED this 18th day of November, 1997, in Tallahassee, Leon County, Florida. COPIES FURNISHED: Daniel Villazon, Esquire Department of Business and Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, Florida 32802-1900 Mr. Lynton Oliver Thomas L T Express Realty Corp. 10810 Northeast Tenth Place Miami, Florida 33161 CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 18th day of November, 1997 Henry M. Solares, Division Director Division of Real Estate Post Office Box 1900 Orlando, Florida 32802-1900 Lynda L. Goodgame, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
Findings Of Fact Frederick Hodgdon (Hodgdon) has held Florida real estate broker license 0206805 at all times pertinent to this case. Hodgdon is owner and qualifying broker for Pelican Realty of Marco Island, Inc., (Pelican Realty), through which Hodgdon conducts business and which also is named as a respondent. At all times pertinent, Pelican Realty has held Florida corporate real estate broker license 0223934. July 24 through August 6, 1984, respondents placed the following newspaper advertisement in the Sun-Daze: DO YOU KNOW ... that all Florida real estate brokers are agents for the seller and CANNOT legally propose any lower than listed prices or better terms for the benefit of the buyer? UNLESS ... the broker legally qualifies himself as an agent for the buyer. As a Buyer's Broker Pelican Realty CAN and DOES exactly this and a lot more! Buyers pay no fees or commissions. Call or send for our informative brochure, you will be glad you did. The real estate buyer's best bet for the best price is to have a Buyer's Broker. On February 19, 1986, respondents placed the following newspaper advertisement in the Marco Island Eagle: 1/ BUYER BEWARE! DON'T BUY REAL ESTATE ON MARCO ISLAND. ... before consulting an attorney or carefully reading Paragraph 5) and 7) of the 1985 Revision of the Sales Contract as approved by the Naples Area Board of Realtors and the Marco Island Area Board of Realtors and the Collier County Bar Association contract Revision Committee. The Contract states quote: "The Buyer has inspected the property sold by the Contract and there are no other inspections permitted or required. The property is acceptable in its AS IS condition as of date of this offer. INCREDIBLE! ... What happens to the unwitting Buyer who intends to have termite, structural and seawall inspections AFTER his offer is accepted? He just may have to buy a termite ridden house that needs a new roof and a seawall that is on the verge of collapse. Thats what! ... Taken at face value the Sales contract calls for the buyer to spend several hundred dollars for inspections BEFORE making an offer that may well be turned down. INCREDIBLE! .... Paragraph 7) states quote: "Buyer's decision to buy was based on Buyer's own investigation of the property and not upon any representation, warranty, statement or conduct of the Seller, or broker, or any of Seller's or broker's agents" (Excluding those rare occasions when the seller and his agents remain silent.) INCREDIBLE! ... The above subject sections of Paragraphs 5) and 7) of the 1985 Sales Contract in our opinion may well violate the Realtor's Code of Ethics Article 7) "to treat fairly all parties to the transaction." There is nothing Pelican Realty could say or do to better emphasize the Buyer's need to have an advocate on his side. ... As a Buyer's Broker we recommend striking out any and all terms and conditions of the Sales Contract that are prejudicial to the Buyer's best interests. ... Pelican Realty would appreciate the opportunity to discuss with any interested parties the many advantages of working with a Buyer Broker. Our services are at NO additional expense to the buyer. CALL US FOR FURTHER DETAILS. NOW!! On March 11, 1986, respondents placed the following newspaper advertisement in the Sun-News: CASH BACK FOR THE REAL ESTATE BUYER. THAT'S INCREDIBLE! Pelican Realty GUARANTEES CASH BACK to every buyer on every sale. The bigger the sale, the bigger the cash gift to the buyer. On top of this Pelican Realty (a Buyer's Broker) goes all out to get the lowest possible price for the buyer at NO additional cost to the buyer. Other realtors must get the highest price for the seller. The thousands you SAVE already belong to you. THINK ABOUT IT! Call us for further details NOW! "WE PAY OUR BUYERS TO DO BUSINESS WITH US" There is nothing false or fraudulent about the three advertisements. However, the following statements in the advertisements are deceptive or misleading in form or content: The representation in the July 24 through August 6, 1984, Sun-Daze advertisement that buyers pay no fees or commissions. In form, the buyer perhaps does not pay brokerage fees or commissions. But in substance, the buyer does indirectly pay his broker a brokerage fee or commission when the seller pays fees and commissions out of the proceeds of the sale. The representation in the July 24 through August 6, 1984, Sun-Daze advertisement that a buyer's broker "legally qualifies himself as an agent for the buyer." Although perhaps technically correct, this representation implies separate state regulation and qualification procedures for licensure as a buyer's broker. In fact and in law, any licensed real estate broker can become a buyer's broker simply by entering into an agreement with a buyer to be the buyer's broker. The representation in the March 11, 1986, News-Sun advertisement: "Other realtors must get the highest price for the seller." Read carefully in context, this representation is true--realtors other than those representing a buyer must try to get the highest price for the seller he represents (while being open, honest and fair to the buyer). But, as written, the representation could lead one to believe that the respondents have an ability no other realtors have when, in fact and in law, any realtor or other licensed real estate broker who represents a buyer can try to get the best price for the buyer. Although respondents have offered cash rebates, no client has seen the offer or asked for a rebate. Although respondents have maintained their innocence, they changed the ads to meet the criticism of the Department of Professional Regulation.
Recommendation Based on the foregoing Findings Of Fact and Conclusions Of Law, it is recommended that the Florida Real Estate Commission enter a final order (1) reprimanding respondents, Frederick Hodgdon and Pelican Realty of Marco Island, Inc., and (2) fining them $500 each for violations of Section 475.25(1)(c), Florida Statutes (1985). RECOMMENDED this 21st day of July, 1987, in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 21st day of July, 1987.
The Issue Whether Respondent committed five violations of the Yacht and Ship Brokers' Act, including the following counts: 1) failing to have the license of each salesperson in his employ prominently displayed in his principal place of business; 2) failing to place deposits received from clients pursuant to transactions involving yachts into a broker's trust account; 3) allowing a person licensed only as a salesperson to act as a broker and to use the broker's name to evade the provisions of the Yacht and Ship Brokers' Act; 4) failing to deposit funds into the broker's trust account within three working days of receipt of funds pursuant to a purchase contract by a salesperson licensed under him; 5) allowing a salesperson licensed under him to carry out acts which if committed by the broker would place him in violation of the Yacht and Ship Brokers' Act and the rules thereunder, such as violating the Notary Public Law, failing to exercise due professional care in the performance of brokerage services, and making substantial and intentional misrepresentations with respect to transactions involving yachts, as alleged in the Amended Notice to Show Cause, in violation of the Yacht and Ship Brokers' Act, Chapter 326, Florida Statutes, and if so, what penalty should be assessed.
Findings Of Fact Petitioner is the agency of the State of Florida charged with the responsibility to administer and enforce the Florida Yacht and Ship Brokers' Act, Chapter 326, Florida Statutes. The purpose of the Yacht and Ship Brokers' Act is to protect the consumer. A yacht broker is an individual who, in expectation of compensation, sells used boats in excess of 32-feet in length for other persons. In order to obtain a license to act as a yacht broker, an individual must submit an application, undergo a background check for moral character, submit a surety bond, and demonstrate to the Division that he has a trust account to place funds received in pending yacht transactions. Before being able to independently perform yacht brokering services as a yacht broker, an individual must spend two consecutive years as a yacht salesperson in a mentorship working under a broker. At all times relevant to this action, Respondent held a license with Petitioner to operate as a yacht broker. Respondent continues to be licensed as a yacht broker. In late 1995 and early 1996, Respondent operated his yacht brokerage business, Greg and Associates, from two locations. His main office was located in Rockledge, Florida, and a branch office was located in Sarasota, Florida. No brokers were present at the Sarasota location. Respondent operated the Sarasota branch office from his main office in Rockledge, Florida. He never visited the Sarasota branch office. Respondent viewed his relationship to the Sarasota branch office as an "escrow agent." Bullock, a salesman, had complete autonomy to run the Sarasota branch office. Respondent met Bullock only once, and he never met any of the other salesmen who operated out of the branch office. Respondent had only a commission arrangement with Bullock. Respondent sent checks for all commissions to Bullock, who deposited them in Bullock's company, Friar Tuck, Inc's., Barnett Bank business account. Respondent allowed Bullock to hire the other salesmen, to determine a commission arrangement with the other salesmen, and to disburse commissions to the other salesmen. Respondent did not know the commission arrangement with most of the salesmen in the branch office. On April 16, 1996, Respondent was interviewed in his office about some complaints that had been received concerning the operation of his Sarasota branch office. Among the salesmen working under Respondent's broker's license in his Rockledge office at that time were Darrell Lawson and Mark Salmuller. Respondent did not have the licenses of either of these two salesmen displayed. Both men were listed as active employees by Respondent. At all times relevant to this proceeding, Respondent maintained a broker's trust account, entitled Greg and Associates, d/b/a Yacht Brokerage USA, in the Rockledge branch of the Barnett Bank. At all times relevant to this proceeding, Chester Bullock, a yacht salesperson working for Respondent in Respondent's Sarasota branch office, maintained a business checking account entitled Friar Tuck, Inc., d/b/a Yachtmasters, in a Sarasota branch of the Barnett Bank. Bullock was listed as president of the company and was identified as a signatory on the account. This was not a proper broker's trust account, as Bullock, being a yacht salesman, could not have established such an account. In July 1995, Chester Bullock and Jeff Webb, salesmen in the Sarasota branch office, took an offer and received a $1,000.00 deposit from David and Cynthia Cislo, on a 1979 34-foot Marine Trade Trawler. Respondent's salesmen did not deliver the deposit to Respondent's trust account within three days of its receipt. The funds were deposited in Bullock's business checking account at the Sarasota branch of the Barnett Bank. Sometime later, the money was redeposited in Respondent's trust account. Bullock notarized the vessel bill of sale at the time of the closing, and received a commission on the sale. In November 1995, Bullock took an offer and received a $5,350.00 deposit from a Louisiana client, Charles Cosgrove, on a 1964 38-foot Chris-Craft Commander yacht. Respondent's salesman did not deliver the deposit to Respondent's trust account within three days of its receipt. On November 27, 1995, Bullock and Jeff Webber, Respondent's salespeople, acted as listing broker and salesperson, respectively, on the lease-purchase of the 1964 38-foot Christ Craft Commander by Cosgrove. Respondent never signed the brokerage sales record, which is the closing statement given to the lease-purchaser, Cosgrove, and was never identified as broker of record on any of the sales documents. Instead, the purchase-sale agreement lists Bullock as the broker, and the closing statement lists Bullock as the broker. Bullock acted as the notary public for the lease-purchase agreement. In January 1996, Bullock and Harold Raines, yacht salesmen in the Sarasota branch office, took an offer and received a $1,700.00 deposit from a client, Michael Hill, on a 1973, 53-foot Huckins yacht. The letterhead of the draft purchase and sales agreement, which stated "Yachtmasters" and a phone number for the Sarasota area, further indicated that Hill's offer was made through yacht salesmen at the Sarasota branch office. Respondent's salesmen did not deliver the $1,700.00 deposit to Respondent's trust account within three days of its receipt. Instead of delivering the $1,700.00 deposit to Respondent for deposit in Respondent's Rockledge broker's trust account, the check was delivered to Friar Tuck, Inc's., Sarasota account. Hill's deposit, which was supposed to be held in a trust account, intermingled with the other business funds of Bullock's account. Hill requested and received an oral extension from Bullock on his closing date to purchase the yacht. About a month later, Bullock notified Hill that the yacht was sold to another party. It was only after Hill threatened to sue Respondent, the responsible broker, and after Hill filed a complaint with Petitioner that Respondent refunded Hill his deposit. The Yacht and Ship Brokers' Act does not permit licensed salespeople to perform certain acts. It requires the employing broker to do them. An employing broker, a broker who holds the license of his salesperson, must make all trust account deposits and withdrawals of monies involved in a transaction brokered by the salesman. An employing broker is required to supervise the yacht transactions brokered by his salespeople and to sign closing statements, which itemize all charges and credits of the transaction for the client. Respondent minimized his own involvement in his Sarasota branch office and permitted his salesman, Bullock, to operate it. This enabled Bullock to sign as the broker a closing statement of the sale of a yacht, which is an action that should have been performed only by a broker. During the same time period that Respondent granted Bullock autonomy to supervise the Sarasota branch office, Bullock operated another business from the same location, Sarasota Marine and Maintenance Services, which did boat surveys and cleaned boats. Bullock was the president of Sarasota Marine and Maintenance Services. In early 1996, Wittman, a Colorado resident at that time, telephoned Bullock about the 1988, 34-foot Wellcraft Grandsport in the magazine advertisement placed by Bullock. Bullock sent Wittman a videotape of the yacht. After reviewing the videotape, Wittman did not think that it was the same yacht advertised in the magazine. Bullock admitted that the yacht in the videotape was not the same yacht advertised in the magazine, but claimed that it was a sister ship. Based upon Bullock's assurances that the sister yacht was in good condition and the results of a survey done by Bullock's company stating that the yacht was in good condition, Wittman purchased the yacht. Bullock acted as both the listing broker and the selling broker in the sale of the 1988, 34-foot Wellcraft Grandsport yacht to Boyd Wittman, the purchaser. Notwithstandng the fact that he was representing the seller, Bullock did not obtain the written consent of Wittman, the purchaser. Wittman wanted a registered surveyor to do a survey of the condition of the yacht, because Wittman lived out-of-state and wanted to avoid spending money to fly to Florida to inspect it. Bullock arranged for his own company, Sarasota Marine and Maintenance Services, to perform the survey. The survey was signed by Ernest Shaffer, who was identified as a Certified Marine Surveyor and Consultant with the Society of Accredited Marine Surveyors, the National Association of Marine Surveyors, and the National Marine Investigators. Ernest Shaffer was someone that Bullock hired to wash boats. He was not a certified surveyor, as he was held to be. When the yacht was delivered to Wittman in Colorado, he was shocked by the poor condition of the yacht. The interior, the cockpit, the exterior, the bilge, and the mufflers were all in poor condition. Wittman was expecting a yacht that he could take someone out on a lake with, and it was not in good enough condition. Wittman had to pay another $15,000 to $20,000 to repair the yacht to improve it to good condition. Repairs included replacing all of the interior of the cabin, replacing the port windshield, putting new mufflers in, fixing a transmission leak, fixing the air-conditioning, rebuilding the water pumps so that the engines cooled properly, and replacing the dry-rot wood on the main deck on the cockpit. In sum, Wittman purchased the yacht for $38,000, spent another $15,000 to $20,000 in repairs, and eventually sold it for $37,000. Bullock also quoted to Wittman a fee for shipping the yacht from Florida to Colorado for $1,500. Wittman thought the price was reasonable. When the yacht was finally shipped, it cost Wittman approximately $3,800, which he paid, because he had already bought the yacht and had to finish the transaction. Bullock acted as both the listing broker and the selling broker in the sale of a 1973, 34-foot Nautiline yacht to Ernest C. Shaffer, the purchaser. Bullock arranged for his company, Sarasota Marine and Maintenance Services, to perform the survey. The survey was signed by Ted Williams, who was identified as a Certified Marine Surveyor and Consultant with the Society of Accredited Marine Surveyors (SAMS), the National Association of Marine Surveyors (NAMS), and the National Marine Investigators. Neither Bullock, Ernest Shaffer, nor Ted Williams, his employees who signed the surveys of the yachts described above, was certified with NAMS or SAMS, two marine surveys accreditation associations. In the case of a 1973, 53-foot Huckins yacht, Bullock tried to sell the boat three times and took three simultaneous contacts on the same vessel. He took a contract from Michael Hill, a prospective purchaser, extended the closing date for Hill to March 6, 1996, and simultaneously had contracts for the same boat with the prospective purchasers Sam Bankester and Steven Kenneally, with the closing dates of February 29, 1996, and March 2, 1996, respectively. Ultimately, Steven Kenneally purchased the yacht. The terms of the contracts did not provide for simultaneous contracts on the same vessel. The prospective purchaser who did not come up with the money first lost out on the opportunity to purchase the yacht. In addition, the Hills, the prospective purchasers, had a difficult time obtaining their earnest money back from Bullock. In January of 1996, Raines, Respondent's salesman, showed Chris June, a North Carolina resident, a 1970, 42-foot Trojan Sea Voyager yacht named "Fantasia." June liked the 42- foot Trojan Sea Voyager and entered into a contract to purchase it through Raines and Bullock. Bullock recommended a surveyor, John Pomeroy, in St. Petersburg, Florida, to complete the survey. Pomeroy was, in fact, not certified with NAMS or SAMS. Bullock told June that the boat was in very good condition and that it was a great value. During the survey, June noticed that wood on the yacht was separating in the bow, and asked Bullock and Pomeroy about it. They explained that this was "wet/dry expansion" which occurs in yachts that sit for a long time and can easily be fixed with some screws and caulking. "Wet/dry expansion" causes wood in wooden yachts to start separating, according to Bullock and Pomeroy, due to the wet wood below the waterline and the dry wood above the waterline. The survey disclosed no substantial problems with the yacht. Relying on the statements of Bullock and Pomeroy, June purchased the "Fantasia" for $22,000, with money loaned to him by a relative. A month after purchasing his yacht, June was informed that his boat was sinking while moored at the dock. June had to hire a marine recovery company to recover the yacht, just before it was about to go completely under water. The yacht took on water in an area near the stern that was not well checked-out, where a basketball-sized wad of putty holding the corner together came loose. As the estimate to repair the boat was more than three times what the boat was worth, June sold it to a salvage yard for $2,500. However, the salvage yard defaulted on that payment. June has been making accelerated payments on his loan, and has the loan down to approximately $19,000. He made a claim against Respondent's surety bond and settled the action for a small amount from the bonding company. Respondent attended two all-day workshops hosted by the Petitioner's Section of General Regulation, which cover in detail how to display a license, to display trust accounts, to display broker's duties and responsibilities, and to display branch offices. Respondent was exposed to the statutes and rules which were violated. Respondent took a cavalier attitude towards following the requirements of the Act. On February 15, 1996, Petitioner entered a Final Order against Respondent in Docket No. YS95397, imposing a fine of $1,500 for Respondent's violation of the Act. Respondent used the name "Yachtmasters" for his Sarasota branch office without having a license issued in that name in violation of Florida law. In the case DBPR v. Chester C. Bullock, Docket No. YS97172 (December 11, 1998), the Petitioner charged Chester Bullock, a registered salesman, with five violations: Charge 1 - The Respondent acted as a broker when he was licensed only as a salesman. Charge 2 - The Respondent made substantial and intentional misrepresentations with respect to transactions involving yachts upon which people have relied. Charge 3 - The Respondent violated other laws governing transactions involving yachts, specifically, he violated Chapter 117, Florida Statutes, by notarizing signatures on documents in which he had a financial interest. Charge 4 - The Respondent failed to immediately deliver deposits received from clients for the purchase of yachts to the broker under whom he was licensed as a salesman. Charge 5 - The Respondent failed to exercise due professional care in the performance of brokerage services, such as recommending his own company as a surveyor to a client and representing it as being an accredited surveyor company, when it was not. Bullock was found guilty on all charges and assessed a civil penalty of $45,000 in that case and had his yacht salesperson's license revoked. The Petitioner has proven each of the violations by clear and convincing evidence. Respondent's explanations for his conduct is not credible.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Division of Florida Land Sales, Condominiums and Mobile Homes enter a final order which: Finds Respondent guilty of the charges set forth in Counts 1, 2, 3, 4 and 5 of the Amended Notice to Show Cause. Respondent's broker's license is hereby revoked. The Division impose a civil penalty of $40,500, which is $500 for Count 1 and $10,000 each for Count 2, 3, 4, and 5. The Respondent shall immediately cease and desist from any violations of Chapter 326, Florida Statutes, and the administrative rules promulgated thereunder. DONE AND ENTERED this 18th day of June, 1999, in Tallahassee, Leon County, Florida. DANIEL M. KILBRIDE 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 18th day of June, 1999. COPIES FURNISHED: William Oglo, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Gregory Linnemeyer 613 Rockledge Drive Rockledge, Florida 32955 Philip Nowick, Director Division of Florida Land Sales, Condominiums, Mobile Homes Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399 William Woodyard, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399
The Issue The issues are whether Respondent violated Sections 475.25(1)(a), 475.25(1)(b), 475.25(1)(d), 475.25(1)(e), and 475.25(1)(k), Florida Statutes, and if so, what penalty should be imposed.
Findings Of Fact Respondent Phillip F. Niles, is and was, at times material to this matter, a licensed real estate broker. His license number is 0173298. Respondent's license was inactive from August 2, 1996, through March 31, 1997. It was invalid due to non-renewal from March 31, 1997 through May 28, 1997. From May 29, 1997 through August 20, 1997, Respondent was an active broker. From August 21, 1997 through June 10, 1998, Respondent was an inactive broker. From June 11, 1998, through the date of the formal hearing, Respondent was an active individual broker. The address of his last license was 1700 Ridge Avenue, Holly Hill, Florida 32117. Sam L. Berry owned a condominium located at 840 Center Street, Unit 101, Holly Hill, Florida (hereinafter referred to as the property). Sometime prior to April 27, 1997, Mr. Berry asked Respondent to sell the property. Mr. Berry wanted to receive $20,000 for the property. Mr. Berry told Respondent that he could keep any amount of the sales price in excess of $20,000. Respondent placed an advertisement for the sale of the property in the newspaper. Thereafter, he prepared a Contract for Sale and Purchase (the contract) for the sale of the property with $20,000 as the sales price. The buyer's name was John Richards. Meanwhile, Peggy Holloway became interested in the property after seeing Respondent's advertisement. Ms. Holloway contacted Respondent at the number referenced in the advertisement. Subsequently, she met Respondent at the property. At that time Respondent's broker's license was inactive. Ms. Holloway made an offer on the property. In order to make a commission or profit on the sale, Respondent decided to sell the property to her. He changed the existing contract by marking through Mr. Richard's name and adding Ms. Holloway's name as the buyer. Respondent changed the sales price on the contract to $23,000. On April 27, 1997, Ms. Holloway signed the contract as the buyer. That same day, Mr. Berry signed the contract as seller. As part of the contract, and pursuant to Respondent's instructions, Ms. Holloway made a check out to Respondent, personally, in the amount of $500. Respondent assured Ms. Holloway that he would place the money in an escrow account. The contract stated that the $500 deposit would be held in escrow. Respondent did not place Ms. Holloway's money in escrow. He cashed her check and kept the $500. At all times material to the transaction Ms. Holloway believed that Respondent was a licensed real estate broker. Additionally, the contract contained language stating that Respondent was a real estate broker. During subsequent conversations with Ms. Holloway about financing arrangements for the purchase of the property, Respondent appeared drunk. As a result of those conversations, Ms. Holloway became suspicious about Respondent's intentions and his competence to handle the real estate transaction. Ms. Holloway contacted Petitioner and learned that Respondent's license was inactive. On or about May 6, 1997, Ms. Holloway telephoned Respondent. She told him that she did not want to go through with the contract. She demanded that Respondent return her $500 deposit. Respondent failed to return Ms. Holloway's $500 deposit. Ms. Holloway then began to deal with Respondent's brother, Peter Niles, who is an attorney. Respondent's brother prepared a document for Mr. Berry to sign acknowledging receipt of the $500 deposit. Mr. Berry signed the document prepared by Respondent's brother even though Respondent never gave the $500 deposit to Mr. Berry. Ms. Holloway eventually decided to deal directly with Mr. Berry. They agreed on a sale price and closed the transaction with no assistance from Respondent, his brother, or any other individual. Ms. Holloway sued Respondent in the County Court of Volusia County, Florida. In Case No. 97-31586, the County Judge entered a judgment against Respondent in favor of Ms. Holloway. Respondent had not satisfied the judgment as of the date of the formal hearing.
Recommendation Based upon the findings of fact and conclusions of law, it is RECOMMENDED: That Florida Real Estate Commission enter a final order suspending Respondent's license for a period of ten years and requiring him to pay a fine in the amount of $1,000 within one year of the date of the final order. DONE AND ENTERED this 15th day of June, 1999, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD 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 15th day of June, 1999. COPIES FURNISHED: Laura McCarthy, Esquire Department of Business and Professional Regulation 400 West Robinson Street Orlando, Florida 32802 Phillip F. Niles 5747 Sweetwater Boulevard Port Orange, Florida 32127 Phillip F. Niles Apartment 503 100 Seabreeze Avenue Daytona Beach, Florida 32118 Herbert S. Fecker, Division Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Orlando, Florida 32802-1900 William Woodyard, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
