The Issue The issue for determination is whether Respondent committed the offenses set forth in the Administrative Complaint and, if so, what penalty should be imposed.
Findings Of Fact At all times material hereto, Respondent was licensed by the State of Florida as a real estate broker, having been issued license number 0521991. Respondent's last license issued was as a broker c/o Stellings Realty, Inc., 2368 Saratoga Bay Drive, West Palm Beach, Florida. Beginning on or about March 1, 1998, until August 31, 1998, Respondent had an Exclusive Right of Sale Listing Agreement (Agreement) with Judy Cominse (Seller) for real property, owned by the Seller, located at 4397-B Woodstock Drive, West Palm Beach, Florida. Respondent represented the Seller as a transaction broker and owed her certain duties pursuant thereto. A Brokerage Relationship Disclosure statement was provided to the Seller by Respondent. Another broker, Robert Berman, was the referring agent and was personally known by the Seller. Respondent was of the opinion that Berman was to receive a referral fee of 25 per cent in the event of a sale. The listing was problematic for Respondent. Respondent encountered problems due to restrictions placed on the showing of the property by the Seller and her tenants, who were the Seller's son and daughter-in-law. Respondent contemplated not continuing with the listing. He even mentioned discontinuing the listing with the Seller, but he did not discontinue it. A contract for sale of the Seller's property was entered into by the Seller and Evelyn Swinton (Buyer Swinton). Buyer Swinton signed the contract on June 1, 1998, and the Seller signed it on June 3, 1998. The contract provided, among other things, for an escrow deposit of $1,500 to be held by Sun Title, located in Lake Worth, Florida. The $1,500 was paid and held in escrow by Sun Title. The transaction for the sale of Seller's property failed to close. By a Release and Cancellation of Contract for Sale and Purchase form (Release and Cancellation) dated July 28, 1998,1 both the Seller and Buyer Swinton agreed, among other things, that the $1,500 escrow deposit would be disbursed to the Seller. On July 30, 1998, Sun Title prepared an escrow check in the amount of $1,500, made payable solely to the Seller. The check was forwarded to Respondent sometime after July 30, 1998; the evidence presented was insufficient to show when Sun Title forwarded the check to Respondent.2 On August 6, 1998, Respondent prepared an addendum (Respondent's Addendum) to the Agreement that he had with the Seller. Respondent's Addendum was dated and signed by Respondent on this same date. Respondent's Addendum provided, among other things, the following: This contract [Agreement] will be extended from August 31, 1998 until March 1, 1999; if necessary.3 * * * Stellings Realty, Inc. will receive 7% of the total purchase price. In addition 25% commission of the listing side will be given to Berman Realty as a referral fee. If the Seller should cancel this listing the cancelation fee would be $1000.00. Judy Cominse [Seller] will receive $1500.00 by mail upon acceptance. Paragraph numbered 5 of Respondent's Addendum indicates that, upon the Seller accepting Respondent's Addendum, the Seller will receive $1,500, which was the escrow deposit, by mail. The Seller did not accept Respondent's Addendum although the Seller was of the opinion that the only way for her to obtain the $1,500 was to agree to an addendum to the contract that she had with Respondent. With the assistance of her sister, who was a licensee, licensed by Petitioner,4 the Seller negotiated a change of terms to Respondent's Addendum. The seller prepared and executed an addendum (Seller's Addendum) on August 6, 1998, and forwarded it to Respondent. The Seller's Addendum provided, among other things, the following: This listing agreement [Agreement] will be extended six months (i.e., from August 31, 1998 until February 28, 1999). * * * Stellings Realty, Inc. will receive 7% of the total selling price (if sold at full listing price), otherwise negotiable; however, no lower than 6%. Additionally, $533.75 to the listing agency (Stellings Realty), which amount will not be subject to the referral fee due and payable to Robert A. Berman Real Estate, the referring broker to the listing agency. If the seller should cancel this listing, the cancellation fee would be $788.75 ($250.00 cancellation fee, plus $533.75). Judy Cominse [Seller] will receive $1,500.00 (100% of the escrow deposit relinquished by the buyer [Buyer Swinton]) by mail upon acceptance. Paragraph 5 of Seller's Addendum indicates that, upon Respondent's accepting the Seller's Addendum, the Seller will receive $1,500, which was the escrow deposit, by mail. Respondent executed the Seller's Addendum on August 11, 1998, and faxed it to her on this same date. Respondent accepted the Seller's Addendum on August 11, 1998. Prior to August 11, 1998, Berman had contacted Respondent on behalf of the Seller. Berman was requested by the Seller to make an attempt to obtain the escrow deposit of $1,500 for her. Berman contacted Respondent who indicated to Berman that, as soon as the escrow check was received, he would contact Berman. Sometime after July 30, 1998, Berman contacted Sun Title and was informed that the escrow check had been prepared and forwarded to Respondent. On or about August 11, 1998, Respondent contacted the Seller and informed her that the escrow check had been received by him. On or about August 11, 1998, Respondent also contacted Berman regarding the receipt of the escrow check. At the request of the Seller, Berman went to Respondent's office, obtained the escrow check, and forwarded it to the Seller via express delivery. Based upon the required proof, the evidence fails to demonstrate that Respondent refused to relinquish the $1,500 escrow deposit to the Seller in order to force or pressure the Seller to agree to an addendum to their Agreement. Respondent continued to represent the Seller. The Seller's property was sold on November 3, 1998. Subsequently, Respondent sued the Seller in the County Court of West Palm Beach, Florida for $533.75, based on the Seller's Addendum. The Seller had refused to pay Respondent the $533.75, pursuant to the Seller's Addendum, and Respondent sued the Seller to recoup the monies. On or about January 4, 1999, the court suit was settled. Before the end of 1998, Respondent paid Berman the referral fee.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Real Estate enter a final order and therein dismiss the Administrative Complaint filed against Leon Stellings. DONE AND ENTERED this 31st day of July, 2000, in Tallahassee, Leon County, Florida. ERROL H. POWELL 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 31st day of July, 2000.
The Issue Whether either Respondent violated the provisions of chapter 475, Florida Statutes,1/ regulating real estate sales associates, as alleged in the administrative complaints, and if so, what sanctions are appropriate.
Findings Of Fact The Florida Real Estate Commission, created within the Department, is the entity charged with regulating real estate brokers, schools, and sales associates in the State of Florida. The Division of Real Estate is charged with providing all services to the commission under chapters 475 and 455, Florida Statutes, including recordkeeping services, examination services, investigative services, and legal services. In 2006, Ms. Linda Fiorello and Ms. Catherine Lichtman, associates at another brokerage, decided to open up their own real estate business, with each owning a fifty-percent share. They created Luxury Realty Partners, Inc. (“the corporation”), a licensed real estate corporation in the State of Florida. While Ms. Lichtman was initially the qualifying broker, she soon stepped down from that position and a series of other individuals served as brokers for the corporation. Neither Ms. Fiorello nor Ms. Lichtman was licensed as a real estate broker at any time relevant to the Administrative Complaints. The corporation sold, exchanged, or leased real property other than property which it owned and it was not an owner-developer. On April 23, 2010, Mr. Brian Davis was added as the sole officer and director of the corporation, and he became the qualifying broker. At all times material to the complaints, Ms. Fiorello and Ms. Lichtman were licensed as real estate sales associates in the State of Florida, Ms. Fiorello having been issued license number 659087 and Ms. Lichtman having been issued license number 3170761. They worked together at the corporation, nominally under the direction, control, and management of Mr. Davis. The corporation did not maintain an escrow account. Mr. Davis did not manage any of the corporation’s bank accounts. He was not a signatory on the operating account. He did not collect brokerage commissions or distribute them to sales associates. He testified he went into the office “maybe once, once or twice a month.” When he agreed to become the qualifying broker for the corporation, he did not even know all of the names of the agents he was supposed to be responsible for. Mr. Davis stated: Well, basically, I was just doing a favor and I was – I put my license there until one of the other two could get their Broker’s license. I was just really stepping in for a short term to – to fill the time frame until one of them could get their Brokerage license, and I didn’t go on any management or any other books or anything of that nature. As Ms. Patty Ashford, one of the sales associates testified, Mr. Davis was seldom in the office. Ms. Ashford would turn in her contracts to Ms. Fiorello or Ms. Lichtman, who would review them. Ms. Ashford testified that her commission checks were then paid by checks signed by Ms. Lichtman. In short, Mr. Davis effectively provided no direction, control, or management of the activities of the corporation or its sales associates. In December of 2009, Ms. Jennie Pollio was living at 10861 Royal Palm Boulevard in Coral Springs, Florida (the property), a Section 8 property that she had been renting from Mr. Jimmy Laventure for about nine years. The property was in foreclosure. Ms. Pollio thought that she might be able to buy the property. She consulted Ms. Victoria Guante, a real estate sales associate with Luxury Realty Partners, Inc. Ms. Pollio knew Ms. Guante because they both had sons who played baseball on the same team. Ms. Guante told Ms. Pollio to get $40,000.00 in cashier’s checks and put it in escrow with Luxury Realty Partners, Inc., so that she could make a strong offer and show that she really had the money. Although they were not produced as exhibits at hearing, Ms. Pollio testified that she signed a couple of different contracts for the property in early 2010. On or about April 29, 2010, Ms. Guante accompanied Ms. Pollio to the bank to get cashier’s checks. Ms. Pollio received five Bank of America cashier’s checks made out to “Luxury Partner Realty,” four in the amount of $9000.00, and one in the amount of $4000.00. Ms. Pollio understood that the property could be purchased for a total of $40,000.00, which included $37,000.00 for the property, and the balance in closing costs. The cashier’s checks were not given to a broker. Ms. Pollio gave the $40,000.00 to Ms. Fiorello as a deposit on the property when she met with her in the corporation office on State Road 7. Ms. Pollio made a copy of the cashier’s checks and Ms. Fiorello wrote a note on the bottom of the copy, “Received by Linda A. Fiorello for Luxury Escrow deposit on contract 10861 Royal Palm Blvd Coral Springs FL 33065” and gave it back to Ms. Pollio.2/ Although the payee name on the cashier’s checks was transposed, Ms. Pollio gave the checks to Ms. Fiorello as agent of the corporation as a deposit on the property, and Ms. Fiorello accepted the checks on behalf of the corporation for the same purpose. Ms. Fiorello did not advise Mr. Davis that the checks had been received. Instead, she deposited the checks in an account formerly belonging to Luxury Property Management, an entity unaffiliated with Luxury Realty Partners, Inc.3/ Luxury Property Management had never been a licensed real estate brokerage corporation, and was no longer in existence, as it had been dissolved. The account had never been properly closed. The account usually had a low balance. Just prior to the deposit of Ms. Pollio’s money, the balance was $10,415.15. Ms. Lichtman had no ownership or interest in Luxury Property Management, but she was aware of the account. The corporation did not have an escrow account, and the Luxury Property Management account was sometimes used to hold money “in escrow,” as Ms. Lichtman was aware. As he testified, Mr. Davis knew nothing about this account and did not authorize Ms. Fiorello to place Ms. Pollio’s deposit there. Ms. Fiorello’s contrary testimony that she told Mr. Davis of the transaction and had his authorization was not credible and is rejected. Ms. Guante was negotiating for the property on Ms. Pollio’s behalf. She testified: At that point the guy was asking (unintelligible) I think was sixty-five, and then we made the offer for $40,000.00. The guy came back and say “no,” and then we went back and make another offer for $50,000.00, and then by that time the guy still say “no.” And then her and I get into an argue because baseball game that don’t have nothing to do with the real estate and then she decided she don’t want me no more as her agent. Ms. Guante called Ms. Fiorello and told her that Ms. Pollio didn’t want to work with Ms. Guante anymore. Ms. Fiorello told Ms. Guante not to worry about it, that the corporation would handle the transaction for Ms. Pollio. On September 23, 2010, a check in the amount of $40,000.00 was written from the Luxury Property Management, LLC, account to Luxury Realty Partners. It is undisputed that the hand writing on the “amount” and “pay to the order of” lines on the check was that of Ms. Lichtman, while the signature on the check was that of Ms. Fiorello. This check, posted into the corporation’s operating account the same day, along with a check for $6000.00, left a balance of only $684.15 in the Luxury Property Management, LLC, account. The two sales associates gave completely different explanations for the check. Ms. Fiorello testified that she always left one or two signed checks locked in the office when she was out of town. She testified that only she and Ms. Lichtman had keys to the lock. Ms. Fiorello testified that without her knowledge, Ms. Lichtman had removed a signed check and filled in the top portion. She testified that although it was her account, she did not realize that the money had been removed until around May 2011, some eight months later.4/ On the other hand, Ms. Lichtman testified that on numerous occasions, the two associates would write out checks together, and that in this instance they discussed the transfer in connection with the opening of a Rapid Realty real estate office in New York which involved Ms. Fiorello’s son. Ms. Lichtman testified that she filled out the top portions of the check, and Ms. Fiorello then signed it. Ms. Lichtman testified that the $40,000.00 “represented monies coming back into Luxury Realty Partners from Rapid Realty.” Ms. Lichtman did not explain why funds from Rapid Realty to repay a loan from Luxury Realty Partners would have been deposited into the Luxury Property Management account, and records for the Luxury Property Management account do not reflect such deposits. On November 4, 2010, a little over a month later, Ms. Lichtman transferred $40,000.00 from the corporation operating account into an account for Chatty Cathy Enterprises, an account controlled by her, and inaccessible to Ms. Fiorello. Ms. Lichtman’s explanation for these transfers, that the $40,000.00 came from the New York real estate venture in repayment of a loan made from the corporation, was unpersuasive, and is rejected. First, the only documentary evidence of a loan made to the “start-up” was an unsigned half-page note dated April 30, 2010. That document indicated that an interest-free business loan in the amount of 25,000 would be made from the corporation to “Rapid Realty RVC and its owners” and that re- payment of the loan would be made in monthly payments to the corporation. No amount was specified for these payments. Similarly, there was no evidence of any repayment checks from Rapid Realty to Ms. Fiorello, Ms. Lichtman, or the corporation. A document dated November 5, 2010, purports to be a “formal release” of that loan. It states in part: The above stated note lists a dollar amount of $25,000 dollars which is inaccurate. The total balance of the loan was approximately $48,000 dollars that was loaned by Luxury Partners Realty (sic), Catherine A. Lichtman and Linda A. Fiorello. This is the formal dollar amount of the loan that is considered paid and satisfied in full. This release appears to be signed by Ms. Lichtman and Ms. Fiorello. Even assuming that the loan had been repaid in full by the New York venture (although no corporation account deposits indicate this), it is not credible that Ms. Lichtman believed she was personally entitled to a payment of $40,000.00 for repayment of a $48,000.00 loan made by the corporation. The spreadsheet of itemized expenses of the New York office and offered by Ms. Lichtman as proof of amounts loaned has no apparent correlation to a spreadsheet prepared by Ms. Lichtman purporting to show checks and cash amounts transferred to New York.5/ In January 2011, Ms. Teresa Ebech, the listing agent for the property with First United Realty, took another contract for the Royal Palm property to Ms. Pollio. This contract referenced a $40,000.00 deposit and listed “Luxury Property Mgt. Escrow” as the escrow. This contract indicated a total purchase price of $55,000.00, and called for a February 21, 2011, closing date. Ms. Pollio signed the contact. The closing did not occur. Ms. Pollio decided to stop trying to buy the property and get her money back. No other party ever acquired an interest or equity in the deposit. Ms. Pollio had difficulty getting in touch with Ms. Fiorello about getting her money back. When Ms. Pollio finally was able to ask Ms. Fiorello for a return of her deposit, Ms. Fiorello did not return it, but told Ms. Pollio that she should get it from Ms. Lichtman. On or about April 28, 2011, Ms. Pollio, with help from her friend, Ms. Joyce Watson, prepared a letter to cancel the contract. The letter noted that the $40,000.00 had been in escrow for over a year and stated that due to the inability of Luxury Realty Partners to close on the property, Ms. Pollio requested immediate return of the deposit. The letter was sent to Catherine Lichtman at the Luxury Realty Partners, Inc., address. Ms. Lichtman’s testimony that she never received the letter is discredited. Ms. Ashford, another real estate sales associate at the corporation, had never met Ms. Pollio, but was in the Luxury Realty Partners, Inc., office one day in May of 2011 when Ms. Pollio came in with her husband. Ms. Ashford testified: She came in with her husband pretty much screaming and yelling from the minute she stepped foot in the door. She was very angry, very upset. I looked at her and said, you know, Ma’am please calm down. She said I’m not calming down. She pointed at Cathy, she said she knows exactly why I’m f’in here. This has nothing to do with you. Ms. Lichtman asked Ms. Ashford to call her husband, which Ms. Ashford did, thinking this was unusual because he never had anything to do with what went on at the office. Ms. Pollio yelled at Ms. Lichtman, and Ms. Lichtman yelled back, each becoming more and more agitated. Ms. Lichtman then left the room and locked the door. The police were called, though Ms. Ashford was not sure if it was Ms. Pollio or her husband, or perhaps Ms. Lichtman’s husband, who called them. Ms. Ashford testified that when the police officer arrived, Ms. Lichtman lied and told him that her name was Victoria. The officer tried to calm both parties, and told them it was a civil matter. The police officer finally persuaded Ms. Pollio and her husband to leave. Ms. Ashford testified as follows about the conversation that took place between Ms. Lichtman and Ms. Ashford after Ms. Pollio left: Q What did you say? A I asked her point blank what the hell was going on and she responded. Q What did she respond? A That yes, she had her money. The money was-– Q When you said her money. What-–what are talking about? A She had Jennie’s money. Q She-- A It was a deal, a transaction. “She came into our office with cash coming out of her boobs and I don’t have to give it back.” Were her words. Q Did you tell Cathy that she had to return the money? A Yes, I did. I said “Cathy, its escrow money, it doesn’t matter where she got it from,” and Cathy went on about “it’s illegal she’s a dancer, she’s on Section 8. I’m going to report it to the IRS. She thinks she buying a f’in house.” Ms. Lichtman’s admission to Ms. Ashford after Ms. Pollio left showed that Ms. Lichtman knew that she had money in her possession that had been given by Ms. Pollio to buy a house. Ms. Ashford testified that she was upset, as an agent with the corporation, about what appeared to be going on. She and Ms. Fiorello met with Mr. Davis in April of 2011. Ms. Fiorello told Mr. Davis that Ms. Lichtman had stolen funds. Mr. Davis reviewed the January contract that Ms. Fiorello gave him, and concluded that it didn’t make much sense. He had not given any authorization to place escrow funds into the Luxury Property Management, LLC, account. He did not have access to that account or to any of the corporation’s operating accounts to determine if money was missing. After the meeting, Mr. Davis asked Ms. Lichtman what she knew about the accusation. Ms. Lichtman denied that she took any money from an escrow account. Mr. Davis called the Florida Real Estate Commission and reported the incident. At some point, Ms. Lichtman advised Ms. Pollio that the cancellation letter was not sufficient, and provided Ms. Pollio with a “Release and Cancellation of Contract for Sale and Purchase” form. Mr. Laventura signed the form in June 2011, and Ms. Pollio signed the form when she returned it to Ms. Lichtman at the Luxury Realty Partners, Inc., office. The form released Luxury Partner Realty from liability and indicated that the escrow agent should disburse all of the $40,000.00 deposit to Ms. Pollio. At the time of the final hearing, Ms. Pollio had yet to receive her $40,000.00 deposit back. The testimony and documentary evidence in this case clearly demonstrates a recurring and systematic disregard of the legal entities and procedures intended to provide structure and accountability to business and real estate transactions by both Ms. Fiorello and Ms. Lichtman. Ms. Fiorello and Ms. Lichtman employed a qualifying “broker” for the corporation, but intentionally assumed the responsibilities of that position themselves during the time relevant to the Administrative Complaints. In doing so, they each operated as a broker without being the holder of a valid and current active brokers’ license. No evidence was introduced at hearing to indicate that the professional license of either Ms. Fiorello or Ms. Lichtman has ever been previously subjected to discipline.
Recommendation Upon consideration of the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that final orders be entered by the Florida Real Estate Commission: Finding Linda Fiorello in violation of sections 475.25(1)(k), 475.25(1)(d), 475.42(1)(d), 475.42(1)(a), 475.25(1)(b), and 475.25(1)(a), Florida Statutes, as charged in the Amended Administrative Complaint, and imposing an administrative fine of $10,000.00, reasonable costs, and revocation of her license to practice real estate; and Finding Catherine A. Lichtman in violation of section 475.25(1)(d), Florida Statutes, as charged in the Administrative Complaint, and imposing an administrative fine of $1000.00, reasonable costs, and revocation of her license to practice real estate. DONE AND ENTERED this 11th day of June, 2015, in Tallahassee, Leon County, Florida. S F. SCOTT BOYD 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 11th day of June, 2015.
Findings Of Fact At all times material hereto, Respondent has been a licensed yacht salesman. At the time of the transaction which is the subject of this proceeding, Respondent was employed by Van Hart Yacht Sales, Inc. Respondent had customers who were interested in purchas-ing a 37' Irwin sailboat. Respondent checked the computer list-ings and found that Northside Marine Sales, a yacht brokerage firm, had a listing for a 1979 37' Irwin known as the "Ark Royal". Respondent telephoned Northside and spoke with a secre- tary. She advised him that the man most familiar with the vessel was not there but that if Respondent sent his customers to Northside, someone would show them the vessel. Respondent's customers, Paul Copeland and Val S. Meeker, went to Northside Marine Sales to look at the boat. When they arrived there, only William Fiermonti was present. Fiermonti was a salesman for new boats at Northside and, accordingly, did not need to be licensed as a yacht broker or salesman, and he was not so licensed. Fiermonti told Copeland and Meeker that he knew nothing about sailboats and could not assist them, but he could let them look at the boat. He then took them to the boat and unlocked it. He told them to lock it when they were finished, and he left them alone to look at the boat. On March 7, 1993, Copeland and Meeker entered into a Purchase Agreement and Deposit Receipt with the owners of the vessel Ark Royal. The contract called for final payment and delivery of the vessel to occur on May 1, 1993. The purchase agreement is a standard form contract on Van Hart Yacht Sales, Inc., letterhead. Paragraph numbered 15 in that contract calls for the seller to pay Van Hart Yacht Sales, Inc., a commission of ten percent of the gross sale price. William Fiermonti witnessed a signature on that contract. On March 23, 1993, Maryland National Bank, the lien holder on the yacht, sent to Fiermonti correspondence stating the bank's agreement to the sale of the vessel. A fax transmittal cover page dated March 24, 1993, reflects that Fiermonti sent something to Respondent with the notation that it was regarding the Ark Royal. On April 6, 1993, Respondent sent a fax trans-mittal to Fiermonti enclosing the "acceptance of vessel form", suggesting a closing date of April 24, 1993, and suggesting that the closing would probably be scheduled at the bank since the bank was holding the title. The closing statement for the transaction was prepared by Respondent on Van Hart Yacht Sales, Inc., stationery. Respon-dent took the closing statement to the closing. He handled the closing and gave Northside a check for its share of the com-mission. Fiermonti had no involvement in the transaction other than witnessing a signature on a document, contacting a bank to obtain a "pay-off" figure, transmitting to Respondent a document by fax, and receiving from Respondent a document by fax. The transmittal and document he received from Respondent, he gave to Robert Skidmore, the owner of Northside Marine Sales and a licensed yacht broker. Fiermonti received no commission as a result of the sale of the Ark Royal and did not expect to receive a commission. He did not attend the closing. Fiermonti did not solicit the listing for the vessel. He did not offer the vessel for sale or sell it. He did not negotiate the contract for sale and had no involvement in the negotiations. In short, Fiermonti did not act as a salesman or broker as to the Ark Royal trans-action. Similarly, Respondent correctly believed that he had located the yacht in question as a result of a listing by a licensed yacht broker. He further believed that he was "co-brokering" the vessel with Robert Skidmore. A complaint was filed against Robert Skidmore and Northside Marine Sales concerning a different matter. While Petitioner's investigator was investigating that matter, he saw the fax transmittal sheets between Fiermonti and Respondent in Northside Marine Sales' records. The investigator contacted Respondent and requested copies of the documents related to the sale of the Ark Royal. Respondent transmitted the documents to the investigator that same day by fax transmittal. The investi-gator never interviewed Fiermonti regarding his role in the Ark Royal transaction. On April 13, 1994, Petitioner issued a Notice to Show Cause against Robert Skidmore, alleging, among other things, that Skidmore had allowed unlicensed salemen to conduct brokered yacht transactions. In August of 1994 Skidmore and Petitioner entered into a Final Consent Order. That Final Consent Order specifi-cally recites that Skidmore desired to resolve the matter without the necessity of further proceedings and that Skidmore did not admit to any wrongdoing or violation of the statutes and rules regulating his conduct. The Findings of Fact section of that Final Consent Order did not include any finding of wrongdoing on Skidmore's part. Rather, the Findings of Fact section finds as facts only that Petitioner issued a Notice to Show Cause alleging statutory violations and then quotes the allegations made in the Notice to Show Cause. In other words, the factual findings include that a Notice to Show Cause was issued, not that the allegations in that Notice to Show Cause were true.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding Respondent not guilty of the allegations and dismissing the Notice to Show Cause filed against him. DONE and ENTERED this 24th day of July, 1995, at Tallahassee, Florida. LINDA M. RIGOT, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 24th day of July, 1995. APPENDIX TO RECOMMENDED ORDER Petitioner's proposed findings of fact numbered 2, 3, 5, and 6 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed finding of fact numbered 1 has been rejected as not constituting findings of fact but rather as constituting a conclusion of law. Petitioner's proposed finding of fact numbered 4 has been rejected since it is not supported by the evidence in this cause. Respondent's first unnumbered paragraph has been rejected as not constituting a finding of fact but rather as constituting a conclusion of law. Respondent's second unnumbered paragraph has been adopted either verbatim or in substance in this Recommended Order. COPIES FURNISHED: Tracy Sumner, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Mr. James Rich c/o Bob Anslow Yacht Sales 400-B North Flagler Drive West Palm Beach, Florida 33401 Henry M. Solares, Director Department of Business and Professional Regulation Division of Florida Land Sales, Condominiums, and Mobile Homes 1940 North Monroe Street Tallahassee, FL 32399-0792 Lynda L. Goodgame, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue Whether Respondent, Marcella Wyatt Bolt, committed the violations alleged in Petitioner’s Administrative Complaint; and, if so, what penalties should be imposed.
Findings Of Fact The Division is the state agency charged with regulating the practice of real estate in Florida pursuant to section 20.165, Florida Statutes, and chapters 120, 455, and 475, Florida Statutes. At all relevant times, Ms. Bolt was a Florida-licensed real estate broker holding license number BK 3104456. Since February 2, 2007, Ms. Bolt has been the qualifying broker for MWB Real Estate Venture, Inc. (“MWB”), a licensed real estate corporation holding license number CQ 1028208. MWB does business as Tropic Coast Realty. On approximately February 1, 2017, Ms. Bolt hired Laura Mayer to work as an inside sales associate soliciting sales leads for MWB. Ms. Mayer did not hold a real estate license at that time. On approximately August 9, 2017, Ms. Bolt and Ms. Mayer entered into an “Inside Sales Agent Offer and Agreement of Employment” outlining Ms. Mayer’s employment duties and compensation structure. Ms. Bolt agreed to pay Ms. Mayer a base salary and bonuses based on active listings taken and sold. Ms. Mayer was to receive $100.00 per lead that resulted in a sales listing and a structured bonus2 for leads resulting in commissions for Ms. Bolt. Ms. Mayer’s duties included, but were not limited to, the following tasks: (a) calling owners of Florida real estate who were potential sellers; (b) following approved scripts and dialogues provided to her; (c) working to compel each prospect to agree to a face-to-face agent presentation; (d) making follow-up calls as assigned; (e) achieving a minimum goal of five listing presentations per week; and (f) continuously contacting potential sellers until making contact. Ms. Bolt paid Ms. Mayer for performing work associated with the following real estate transactions: $750.00 on May 11, 2017, for the sale of Wading Bird; $400.00 on September 26, 2017, for the sale of Fernandina; $650.00 on September 28, 2017, for the sale of Woodfield; $1,750.00 on October 19, 2017, for the sale of Willoughby; $475.00 on October 27, 2017, for the sale of Darrow; $500.00 on October 27, 2017, for the sale of Rayfield; $375.00 on December 21, 2017, for the sale of Sugar Creek; 2 The structured bonus was a graduated amount based on the sales price. $450.00 on April 18, 2018 for the sale of Achilles; $250.00 on April 18, 2018, for the sale of Hyacinth; $100.00 on September 14, 2018 for the listing of Birdland, Brown; $100.00 on September 14, 2018, for the listing of Goldenrod, Kennedy; $300.00 on September 25, 2018, for the sale of Creel; $100.00 on September 26, 2018, for the listing of Venetian, Nall; $100.00 on October 2, 2018, for the listing of Colorado, Luidmela; $100.00 on October 15, 2018, for the listing of Kerry Downs, DeGraaf; $100.00 on October 15, 2018, for the listing of Emerson, Board; and $250.00 on October 19, 2018, for the sale of Amaryllis. Ms. Mayer did not hold a real estate license when any of the aforementioned payments and/or sales were completed. The Division and Ms. Bolt submitted a “proposed disposition” that is adopted by the undersigned and set forth below.
The Issue Whether Respondent committed the offenses set forth in the Notice to Show Cause and, if so, what action should be taken.
Findings Of Fact Petitioner is the state agency charged with regulating yacht and ship brokers and salespersons pursuant to Chapter 326, Florida Statutes. At all times material hereto, Respondent was a licensed yacht broker.1 She is the yacht broker for Yachting Consultants, Inc. in Fort Lauderdale, Florida. In April 1999, Respondent was the listing broker of record regarding the sale of a 43-foot Pilgrim yacht. The selling broker was Mark Lipkus, a licensed yacht broker. John Pribik, a licensed salesperson, was Respondent's representative in the sale of the Pilgrim yacht. Mr. Pribik was under the supervision and control of Respondent and Respondent was responsible for his actions. Respondent had a buyer for the Pilgrim yacht, and the closing for the sale of the yacht was scheduled for April 13, 1999. The buyer was financing the purchase of the yacht. In a sale situation, a buyer and a seller have different responsibilities. The seller is responsible for providing all of the documents needed for a sale. The buyer is responsible for providing the funds for a sale. In the sale of the Pilgrim yacht, the responsibilities of the Seller and the Buyer did not change. There is a commission from the sale of a yacht, which is paid by the seller and, in accordance with standard industry practice, paid at closing. By standard industry practice, the commission split is 70/30, but can differ upon agreement. Mr. Lipkus received a down payment of $15,000.00 from the Buyer and placed the down payment in his escrow account. Mr. Lipkus was of the mistaken belief that the commission was payable by the Buyer, not the Seller. No co-broker agreement was entered into between Respondent or Mr. Pribik and Mr. Lipkus regarding commission. There was no discussion regarding the split of the commission between them. On a prior sale involving Mr. Pribik and Mr. Lipkus, the commission split was 60/40. Mr. Pribik and Respondent assumed the commission split of the sale of the Pilgrim yacht would again be 60/40. Considering the prior sale, it was not unreasonable for Respondent and Mr. Pribik to assume a 60/40 split of the commission. Mr. Lipkus assumed the commission split would be 70/30. A power of attorney had been prepared by the Seller who was unavailable for closing due to being in a remote area in the Philippine Islands. Mr. Pribik provided the power of attorney to the documenting agent who reviewed the power of attorney and found it to be satisfactory. The mortgage broker received a copy of the power of attorney prior to closing and forward a copy to the lending institution. The lending institution notified the mortgage broker at some point before closing that the power of attorney was unacceptable. In turn, the mortgage broker contacted the documenting agent regarding the unacceptability of the power of attorney and informed the documenting agent that a new power of attorney was required before closing could take place. Mr. Pribik was notified by the mortgage broker that a new power of attorney was required. The responsibility to obtain the new power of attorney was the responsibility of the listing broker, who was Respondent via Mr. Pribik. As far as Mr. Pribik was concerned, with the time remaining before closing2 and with the Seller being in the Philippine Islands, he believed that it was virtually impossible to obtain a new power of attorney by the time of closing. The mortgage broker, taking the position that he should do whatever he could to effectuate a closing, encouraged Mr. Pribik to attempt to contact the Seller. Complying, Mr. Pribik was able to make telephonic contact with the Seller and Mr. Pribik and the mortgage broker spoke with the Seller, who agreed to provide a new power of attorney. Based on the verbal assurance by the Seller to provide the new power of attorney, the lending institution agreed to proceed with the closing, which was re- scheduled for April 14, 1999. A new power of attorney was faxed to the Seller, and the Seller executed it and faxed it back. According to industry standard, all commissions are paid at closing when a seller receives the funds. Also, according to industry standard, closing is not delayed until a commission is paid. Mr. Lipkus mistakenly believed that the commission was paid by a buyer, coming out of a buyer's deposit. As a result, he expected to take the commission out of the Buyer's down payment, which was held in Mr. Lipkus' escrow account. After obtaining his commission, Mr. Lipkus was going to forward the remaining monies. On April 13, 1999, the original date for the closing, the closing could not take place because the financing from the lending institution was not available, based upon the absence of a new power of attorney. Also, Mr. Lipkus had not made arrangements for the deposit monies to be at closing or forwarded a settlement statement to closing, which were both needed for the closing. Respondent contacted Mr. Lipkus by fax regarding the commission monies and the settlement statement, demanding both items in order for closing to take place. The evidence is not clear and convincing as to whether Respondent demanded the monies held by Mr. Lipkus prior to closing or whether Respondent was threatening to delay the closing unless she had the monies prior to closing. The evidence suggests that Respondent was demanding the monies to be in place at closing. Additionally, on the original closing date, closing was to take place at the office of the mortgage broker. Mr. Pribik, the Buyer, and the mortgage broker were present for the closing. Mr. Lipkus did not intend to attend, and did not attend, the closing. Since the commission monies were not available at closing, Mr. Pribik telephoned Mr. Lipkus and demanded that the commission monies be available and, told him that if not made available, the closing could not take place. In Mr. Pribik's opinion, the monies were needed for closing. The evidence is not clear and convincing as to whether Mr. Pribik demanded the monies held by Mr. Lipkus prior to closing or whether Mr. Pribik was threatening to delay the closing if he did not have the monies prior to closing. The evidence suggests that Mr. Pribik was demanding the monies to be in place at closing. Furthermore, for the first time, Mr. Pribik and Mr. Lipkus, during the telephone conversation, became aware of their disagreement as to the proper commission split, whether 60/40 or 70/30. Believing that Mr. Pribik would prevent a timely closing, Mr. Lipkus agreed to Mr. Pribik's split of 60/40. Closing occurred on April 14, 1999. The necessary documents and finances were present. At the final hearing, Respondent expressed with sincerity that, if she did anything wrong, she wanted to know exactly what it was, so that she would not engage in the same conduct again. Furthermore, Respondent expressed the frustration that, prior to hearing, no one had explicitly told her what she had done wrong and that, at hearing, she continued to be unsure what she had done wrong because she had not been explicitly told what she had done wrong. Respondent has no prior disciplinary action.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Florida Land Sales, Condominiums, and Mobile Homes, enter a final order: Finding that Giovanna Gallottini did not violate Rule 61B-60.008(3)(a), Florida Administrative Code. Not sustaining the Notice to Show Cause. DONE AND ENTERED this 6th day of February, 2001, in Tallahassee, Leon County, Florida. ERROL H. POWELL 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 February, 2001.
Findings Of Fact The Respondent Marinatown Realty, Inc., is a corporate real estate broker, holding license number 0208680 and located at 3440 Marinatown Lane, Northwest, North Fort Myers, Florida. Marinatown Realty is a wholly owned subsidiary of Seago Group, Inc., a publicly held land development and rental corporation whose president is Thomas P. Hoolihan. In late 1977, Hoolihan met L. E. Hutchinson, the complainant in this case, through another broker for whom Hutchinson at the time was employed. In December, 1977, Hoolihan and Hutchinson discussed the marketing of two condominium projects being developed by Hoolihan and reached an oral agreement whereby Hutchinson would be paid $18,000 in salary with a 1 1/2 percent commission on all sales. When the condominium units were completed and mostly sold, the parties' employment agreement was revised in late December, 1979. Under the new agreement, Hutchinson was to receive $30,000 a year salary, commissions on the remaining condominium units that had not yet closed and any commissions on outside property listings neither owned nor controlled by Seago. In return for the $30,000 guarantee, Hutchinson was to forego commissions on future properties owned or controlled by Seago Group, Inc. During the period from 1977-1978 when Hutchinson was receiving $18,000 plus a 1 1/2 percent commission, sales were handled through Lee Hutchinson Realty, Inc., which held license number 0182945. In early 1979, Marinatown Realty was incorporated to market Seago's real estate inventory, to identify and list outside properties and to act as a management agent for purposes of renting condominium units previously sold in recent projects. When Marinatown Realty was formed, the complainant became its active broker. While employed as the broker for Marinatown and receiving $30,000 a year as a salaried employee, Hutchinson held two other broker's licenses, one as L. E. Hutchinson Realty, Inc., and another as L. E. Hutchinson. In January, 1980, Hoolihan agreed to pay a $15,000 bonus to Hutchinson in lieu of a salary increase. Since at that time sales were minimal, Hoolihan decided to pay the bonus in installments as sales occurred. Because Hutchinson left in May, 1980, he received only $10,000 of the bonus which represented moneys previously paid. On April 23, 1980, Hutchinson and Chuck Bundschu, a licensed real estate broker, negotiated and obtained a sales contract between Hancock Harbor Properties, Ltd., a wholly owned subsidiary of Seago Group, Inc., seller, and Frank Hoffer, buyer and licensed real estate broker, in which Hoffer offered to purchase approximately 3.16 acres of unimproved acreage for $500,000. Thomas P. Hoolihan, general partner of Hancock Harbor, executed the contract on behalf of the partnership. Prior to presenting the contract to Hoolihan, Bundschu, Hoffer and Hutchinson decided on a 30 percent, 40 percent 30 percent respective co- brokerage split on the $50,000 commission due on the sale of the Hancock Harbor Property. The co-brokerage fee split was typed on the bottom of the contract submitted to Hoolihan and was signed by the three brokers. The commission due to Hutchinson was made payable to L. E. Hutchinson Realty, Inc. On April 25, 1980, the contract with the original co-brokerage split was presented to Hoolihan who refused to agree to its co-brokerage split provision. In the presence of Hutchinson, Hoolihan informed Bundschu and Hoffer that he would not pay a commission to Hutchinson because he was a salaried employee of the Seago Group and not entitled to a commission on the sale of this property. Accordingly, the co-brokerage fee provision of the executed contract was never signed by the seller, Thomas P. Hoolihan. Instead, on April 25, 1980, Bundschu, Hoffer and Hoolihan agreed to a split of $20,000 to Hoffer and $15,000 to Bundschu in lieu of the split specified on the bottom of the contract. At the closing on July 18, 1980, which was held at Coastland Title Company, a closing statement was prepared which shows that real estate commissions were disbursed to Chuck Bundschu Realty, Inc. ($15,000), Marinatown Realty, Inc., ($15,000) and Hoffer's firm, Landco, Inc., ($20,000). The checks were written and disbursed following a conversation between an official of Coastland Title Company and Hoolihan in which Hoolihan informed the official that Hutchinson was a Seago employee and he would not agree to pay a $15,000 commission to him under such circumstances. On July 18, 1980, a check for $15,000 was issued by Coastland Title Company to Marinatown Realty, Inc. The $15,000 represented Hutchinson's share of the co-brokerage agreement. When received on July 18, 1980, by Billie Robinette, the broker for Marinatown Realty, the check was signed over by her to Seago Group, Inc., since in her opinion it did not represent commissions earned by Marinatown Realty. The oral agreement between Hutchinson and Hoolihan was to terminate at the end of April, 1980, or approximately five days after the Hoffer contract was presented. Hoolihan offered to renew the contract without a provision for a guaranteed salary because Marinatown Realty had been consistently losing money since its incorporation. On May 6, 1980, Hoolihan received a letter of resignation from Hutchinson and concluded that his offer had been rejected. In early May, 1980, Hoolihan received a call from Ms. Robinette, who had been employed as Hutchinson's secretary, regarding filling the open brokerage position at Marinatown Realty, Inc. Hoolihan discovered from Ms. Robinette that Hutchinson had paid himself 50 percent of the commissions due Marinatown Realty, Inc., for the management of condominium rentals. After examining the check stubs from Marinatown's bank account, Hoolihan took personal possession of all the books and records of the company and had the office locks changed. When he examined the books and records of the realty company, Hoolihan realized that his assumption that Hutchinson Realty, Inc., became inactive when Marinatown Realty, Inc. was formed in January, 1979, was erroneous and that Hutchinson had operated his own realty company, L. E. Hutchinson Realty, Inc., while employed by Marinatown Realty, Inc. Although he held multiple licenses, Hutchinson denied that a conflict ever existed between his duties to Marinatown Realty, Inc., and his own company, L. E. Hutchinson Realty, Inc. When questioned during the final hearing regarding how he decided where to list properties while he was the broker for both companies, the following exchange occurred between Hutchinson and counsel for Marinatown Realty, Inc.: Q Let me ask you, Mr. Hutchinson, how would it be decided when you were to go out and list property as to whether or not that property would be listed under Marinatown Realty or L. E. Hutchinson Realty, Inc.? Who would make that determination? A I would. Q Solely on your own? A I had no contract with anyone. I had nothing in writing to direct me where to place any business. Q So this would be solely your decision as to how you would list the property? Either Marinatown Realty or L. E. Hutchinson Realty? A If I secured the listing it was my dis- cretion as to where I listed the real estate. I had the choice of one of two companies. * * * Q If you were to list property in my hypo- thetical with Marinatown Realty, is it not a fact that they would receive, and being Marinatown Realty, would receive one half of the commission and you, as the broker, would receive the other half? A That was what I did. Q So it would certainly be beneficial to Seago to have you list as much property as you could with Marinatown Realty because they, in fact, owned the stock with Marinatown Realty, is that not true? A Yes, sir. Q When you would list property with L. E. Hutchinson Realty, Inc., would you do this with the full knowledge, consent and permission of Marinatown Realty, Inc.? A Yes, sir. Q How would you say that you gave full consent when you just testified that it was solely up to you as to how you would list property? A If I solely decided, I give my consent. I don't have anybody else to answer to. (T. pp. 108-110) During the period that Hutchinson was a broker for Marinatown Realty and L. E. Hutchinson Realty, Hutchinson believed his primary duty was toward his own company as illustrated by the following exchange between counsel for Respondent and the complainant: Q It's a fair statement to say that you, as a broker for Marinatown Realty, Inc. didn't make a whole lot of money for Marinatown Realty, did you? A I didn't run the P & L statement. Q I'm asking you as being the broker. You didn't make a lot of money for Marinatown Realty, Inc., did you? A I made as much money for them as I did for the responsibility. Q Well, did L. E. Hutchinson Realty, Inc. make a lot of money during that period of time? MR. FERNANDEZ: Objection as to relevancy, this whole line of questioning. MR. NEEL: Your Honor, it isn't. It's germaine. HEARING OFFICER: Objection overruled. THE WITNESS: I'm sorry, the question? Q Did L. E. Hutchinson Realty, Inc. make a lot of money during this period of time? A That's relative. Q In comparison to what money Marinatown Realty made? A Yes, sir, because L. E. Hutchinson Realty had a thirty thousand retainer that was coming in up until April 30th. Q From Seago? A Certainly. Q So L. E. Hutchinson Realty, Inc. made a lot more money than Marinatown Realty, Inc., didn't they? A That's the way its supposed to work. Q And, again, it was at your sole dis- cretion as to how you would list the properties; under which principal. A Yes, but I asked for a specific con- tract and never got it. (T. pp. 124-125) The Administrative Complaint in this case was filed on July 22, 1981. The preliminary investigative report compiled by Robert Corno, DPR Investigator, was filed on September 24, 1981 and the final investigative report was filed on September 30, 1981. The following is a synopsis of the investigator's findings and recommendation: That the COMPLAINANT [Hutchinson] worked for the SUBJECT [Hoolihan] and their contractual agreement was verbal. COMPLAINANT was paid on a salary/commission basis by companies of which SUBJECT is Chief Officer. That the COMPLAINANT filed civil action suit against SUBJECT in this case and it was dismissed with prejudice. That prior investigation by the DPR re- commended that no action be taken against the SUBJECT in this case. That two weeks after this investigation was undertaken, an Administrative Com- plaint was being filed by the DPR against the SUBJECT. That the existing BROKER for MARINATOWN REALTY, INC. was not involved in this case, and that since the time of the above referenced transaction, the SUBJECT has acquired his BROKER'S license #020462 which had no effect in this case. That conflicting statements by inter- viewers, namely former and present em- ployees and other agents involved in this case revealed that there is a reasonable doubt for probable cause against the SUBJECT. (Respondent's Exhibit 1) As noted by Investigator Corno, this was the second time Marinatown Realty had been investigated in relation to this case. In both instances a recommendation that no action be taken against the Respondent was apparently made. At the final hearing on December 1, 1981, counsel for the Department saw the complete investigative report, including the investigator's recommendation of a lack of probable cause, for the first time. Count II of the Administrative Complaint alleges that Hutchinson is entitled to compensation for services rendered on the following sales contracts: Seago Group, Inc. as seller, to Michael T. and Judith Marchiando as buyers, Seago Group, Inc. as seller, to John E. and Charlotte A. Ferguson as buyers, and Seago Group, Inc. as sellers, to Kenneth J. Dawson as buyer. In regard to the first transaction, the Marchiandos were personal friends of the son-in-law of Seago's major shareholder, Mr. R. Berti. Hutchinson's role in this transaction was limited to preparing the contract and mailing it to the Marchiandos for signature. Hutchinson had no part in selling this property and never met the Marchiandos. The sale of the Ferguson's arose in a manner similar to the Marchiandos. Mr. Ferguson is the manager of a Detroit company owned by Mr. Berti. Similarly, Mr. Dawson works for Mr. Berti in Detroit as an accountant. These sales were made by Mr. Berti and Hutchinson furnished administrative assistance by completing the contracts and sending them to these individuals for signature. Under the terms of the agreement between Hoolihan and Hutchinson, a commission was not due on these properties to Hutchinson since these were not outside listings and his agreement with Hoolihan did not contemplate that commissions be paid in such situations.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Administrative Complaint filed against Marinatown Realty, Inc. be dismissed. DONE and ORDERED this 28th day of April, 1982, in Tallahassee, Florida. SHARYN L. SMITH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of April, 1982. COPIES FURNISHED: Xavier J. Fernandez, Esquire NUCKOLLS JOHNSON & FERNANDEZ Suite 10, 2710 Cleveland Avenue Fort Myers, Florida 33901 James A. Neel, Esquire 3440 Marinatown Lane, N.W. Fort Myers, Florida 33903 Frederick H. Wilsen, Esquire Assistant General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Samuel R. Shorstein, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Carlos B. Stafford Executive Director Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802
Findings Of Fact The parties stipulated to the following factual matters: The Respondent was, at all times alleged in the Administrative Complaint in this cause, a licensed real estate broker having been issued license number OliB294. From February 2, l9B4 to August 13, l9B4 Respondent was licensed and operating as the sole qualifying broker and officer of Commercial International Realty, Inc., a corporation licensed as a real estate broker, 219 Commercial Boulevard, Lauderdale- By-The-Sea, Florida. At all times alleged in the Administrative Complaint, Elaine Sherban was president, sole stock holder and owner of Commercial International Realty, Inc., 219 Commercial Boulevard, Lauderdale-By-The-Sea, Florida. Elaine Sherban is not now, nor was she ever, licensed or a holder of a valid and current license as a real estate salesman, broker-salesman or broker in the State of Florida. On or about December 29, l9B4, Respondent and Commercial International Realty, Inc., via Elaine Sherban, entered into an employment agreement whereby Respondent was employed as a real estate broker. The Respondent has not paid any sum whatsoever to Bobbi Jo Magee. Based upon the evidence received and the demeanor of the witnesses who testified, the following additional findings of fact are made: On or about March 7, 1984, Bobbi Jo Magee, as purchaser, executed a purchase agreement with Robert E. Moon, seller, for an establishment known as Cowboy's Lounge and Restaurant, Inc. The purchase agreement provided for a purchase price of $257,500 and a $10,000 non-refundable deposit. The date of closing was specified in the agreement to be June 7, 1984. In connection with this purchase agreement, Bobbi Jo Magee also executed a promissory note, dated March 7, 1984, in the amount of $35,000, payable to Elaine Sherban or her assigns. The promissory note was due and payable on March 12, 1984 and stated it was for "consulting fees and cash loan." Bobbi Jo Magee testified that she had no money of her own for the deposit called for in the promissory note, but that her mother, Mary Rose Turner, was financially backing her in this transaction. On March 30, 1984, Mary Rose Turner executed a wire transfer in the amount of $35,000 plus an additional $500 to Commercial International Business Brokers Corp., a business owned by Elaine Sherban. Commercial International Business Brokers was located in the same building as Sherban's other business, Commercial International Realty, Inc., but was a separate business with different telephone lines and financial accounts. Turner and Magee testified that this wire transfer was for the deposit on Cowboy's Lounge, and was for an amount greater than the $10,000 deposit called for in the purchase agreement because Sherban told them that Moon would not accept a deposit of only $10,000 on this transaction. Respondent did place several telephone calls to Turner, who was out of the state, on behalf of Sherban in which Sherban made requests for more money. Respondent's role was to make the phone call and leave a message that Sherban needed to talk to Turner or to turn the phone over to Sherban who then discussed the details with Turner. Respondent did not discuss the financial, or any other, details of the transaction with Turner in these calls, but simply placed the calls for Sherban and facilitated discussions between Sherban and Turner. Elaine Sherban was acting through Commercial International Business Brokers in this transaction with Magee, Turner and Moon. She had Magee execute the $35,000 promissory note to cover the $10,000 deposit and consulting fees she charged for her services. Respondent had no knowledge of the reason for this promissory note or what, if any, services Sherban had performed. Respondent did not participate in the execution of the promissory note and purchase agreement other than as-typist, notary and witness. She was not involved in any substantive discussions which caused Magee to sign either document, nor were any part of the funds that were wire transferred by Turner ever received or used by either Respondent, or Commercial International Realty, Inc., the real estate office in which she was employed. The funds which were transferred by Turner on behalf of Magee were received by Commercial International Business Brokers and were used thereafter by Elaine Sherban. The sale of Cowboy's lounge did not close on June 7, l9B4, due to concerns which Magee and Turner developed in late May regarding the business records of Cowboy's Lounge. Because they could not get information which they felt was satisfactory about the financial history of this business, they sought legal advice and notified Sherban and Moon that they would not close. Neither Magee nor Turner have ever received a refund on any part of the $35,500 which was transferred by wire on March 30, l9B4.~_ Between March 7, 1984, and late May Respondent met with Magee on several occasions and with Turner on one occasion at Cowboy's Lounge. Others were also present, including Sherban and Moon. Respondent's role in these meetings was purely social, making casual conversation She did not discuss any aspect of the transaction, or the financial condition of Cowboy 's. Despite the fact that Respondent did not intend to actively participate in the transaction involving Cowboy's Lounge, and in fact did not solicit, negotiate or otherwise intentionally assist with this sale, she did give the appearance of working with and assisting Sherban in this transaction. Magee and Turner made the reasonable assumption that Sherban and Respondent were partners for purposes of this sale. This appearance was given by tlle fact that Sherban said they were acting as partners, the very close proximity of the offices of Commercial International Business Brokers and Commercial International Realty, Inc., common ownership by Sherban of both businesses, Respondent's placing phone calls to Turner on behalf of Sherban, meeting with Turner and Magee at Cowboy's along with Sherban, and her functioning as typist, witness and notary for some of the documents involved in this transaction. No demand by either Turner or Magee has ever been made on Respondent for return of part or all of the $35,500. Through counsel, they did make demand for return of this sum upon Sherban and Moon. There is no evidence that Respondent ever employed Sherban. The evidence is that Respondent was employed by Commercial International Realty, Inc., which was owned by Sherban.
The Issue Whether the Respondent committed the violations alleged in the Administrative Complaint and, if so, what penalty should be imposed.
Findings Of Fact Petitioner is an agency of the State of Florida charged with the responsibility and duty of investigating and prosecuting complaints against real estate professionals in the State of Florida. Respondent is now and was at all times material hereto a licensed real estate broker in the State of Florida, having been duly issued license numbers 0263586, 0261820, 0260480, and 0300938. The last license issued to Respondent was as a broker with the following entities: Avatar Realty, Inc., 4550 Poinciana Boulevard, Kissimmee, Florida; Avatar Communities, Inc., 201 Alhambra Circle, Coral Gables, Florida 33134; Golden Gate Realty, Inc., 4736C Golden Gate Parkway, Naples, Florida; and Avatar Condominium Management, Inc., 201 Alhambra Circle, Coral Gables, Florida. Prior to February 20, 1987, Respondent was the owner of a convenience store known as Hemispheres Food Mart, which was located in the Hemispheres condominium and office complex in Hollywood, Florida. On or about February 20, 1987, Respondent, as owner, entered into a three month exclusive right of sale listing agreement with South Florida Business Negotiators, Inc., for the sale of the Hemispheres Food Mart, at an asking price of $100,000. In connection with the foregoing listing agreement, the Respondent represented and warranted as true that the: "Business doing $286,000 yearly net $55,000 ambitious owner can improve potential to $350,000 yearly." On or about April 1, 1987, the Respondent, as seller, entered into a "Contract for Purchase and Sale of Stock of Hemispheres Food Mart, Inc., D/B/A Hemispheres Mini Mart" with Kenny Mohammed and Annie Mohammed, his wife, as purchasers, to sell the corporate stock of Hemispheres Food Mart, Inc. to the Mohammeds. This contract was executed by the Mohammeds on April 2, 1987. The first line of the contract reflects an erroneous date for the contract of May 5, 1987. Paragraph 12 of the "Contract for Purchase and Sale of Stock of Hemispheres Food Mart, Inc., D/B/A Hemispheres Mini Mart", provided as follows: 12. PURCHASER'S RIGHT TO INSPECTION OF SELLER'S RECORDS. The Purchaser, within 72 hours after the con- tract has been signed and executed by both parties, shall have the right, either by himself or through his accountant, to inspect the financial records and receipts of the Seller to verify the amount of sales of the Seller on a weekly basis. The Purchaser shall verify that the average gross sales on a weekly basis for the Seller, during the time period from January 1 through April 1 (the season) exceed the sum of $8,400.00 per week. If the Purchaser by himself or through his accountant determines that the gross sales for the Seller are less than $8,400.00 per week, the Purchaser shall have the unilateral right to terminate its obligations under the terms of this Contract. Seller shall supply Purchaser with copies of 1985 and 1986 tax returns. The Seller agrees to allow the Purchaser to sit in the place of business for a period of one week to observe and verify that the stated daily gross sales of the business exceed $1,200.00. If during the one-week observation period the daily gross sales do not meet $1,200.00, the Purchaser reserves the right to cancel this Agreement and the deposit held in escrow shall be refunded to them. On May 7, 1987, Respondent and the Mohammeds executed an addendum to their contract. Paragraph 23 of the addendum provides as follows: 23. INSPECTION OF RECORDS It is hereby agreed that both parties shall have complied with paragraph 12, PURCHASERS' RIGHT TO INSPECTION OF SELLER'S RECORDS, and therefore same shall be considered null and void. The representation contained in the contract relating to the level of sales was for sales made during the "season" between January 1 and April 1. Mr. Mohammed exercised his right to observe the sales during the week that began April 6, 1987. During the week long observation period, the sales for two of the days did not equal $1,200. Mr. Raymond provided various records and cash register tapes for the period January 1 - April 1, 1987, for inspection by Mr. Mohammed and Mr. Mohammed's financial adviser. Following the inspection of these records and the one-week observation period, Mr. Mohammed, against the advice of his attorney, elected to close the transaction. The transaction closed in May 1987. (The closing statement signed by Respondent and the Mohammeds does not reflect the day in May the transaction closed.) Subsequent to the closing, the Mohammeds sued Respondent in a civil action brought in the Circuit Court of the 17th Judicial Circuit, in and for Broward County, Florida. The "Final Judgment for Plaintiffs" entered September 19, 1989, by Circuit Judge J. Cail Lee provides, in pertinent part, as follows: ... [T]he Court having heard the testimony of all witnesses and having examined the proofs offered by the respective parties, the court finds that he testimony of the two witnesses was to the effect the defendant, Warren Raymond, falsified sales during the sales verification period to induce the plaintiffs, Kenny Mohammed and Annie Mohammed, to complete the purchase of the Hemispheres Mini Mart, and that constituted fraud, and that constituted a basis not only for compensatory damages but punitive damages as well. It is therefore, ORDERED AND ADJUDGED that the plaintiffs have a judgment against the defendant for fraud in the sum of $750.00 compensatory damages and $15,000.00 punitive damages ... Respondent appealed the judgment entered against him by Judge Lee. While the case was on appeal, Respondent and the Mohammeds settled the civil suit. Respondent did not admit any wrongdoing in the Settlement Agreement. Thereafter, on March 26, 1990, Judge Lee entered a "Final Judgment of Settlement" in the civil action which vacated the "Final Judgment for Plaintiffs" that he had entered September 19, 1989, and which dismissed with prejudice the civil action the Mohammeds had brought against Respondent. There was no competent evidence presented at the formal administrative hearing that Respondent had (a) misrepresented the value of the premises or potential of the business, (b) generated false sales during the observation period, (c) falsified cash register receipts, (d) conspired with his friends to falsify sales, or (e) otherwise engaged in fraud during the course of his business dealings with the Mohammeds.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered which dismisses the Administrative Complaint brought against Respondent in this proceeding. RECOMMENDED in Tallahassee, Leon County, Florida, this 28th day of January, 1991. CLAUDE B. ARRINGTON 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 28th day of January, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-5320 The following rulings are made on the proposed findings of fact submitted on behalf of the Petitioner. The proposed findings of fact in paragraphs 1-5, 7 and 11 (the first of the two paragraphs that are numbered 11) are adopted in material part by the Recommended Order. The proposed findings of fact in paragraph 6 are adopted in part by the Recommended Order. The proposed finding that the contract was dated May 5, 1987, is rejected as being contrary to the finding that the contract was dated April 1, 1987. The proposed findings of fact in paragraph 8 are adopted in part by the Recommended Order. The use of the term "induced" is rejected as being contrary to the findings made or to the conclusions reached. The proposed findings of fact in the first sentence of paragraph 9 are rejected as being unsubstantiated by the record. The last sentence is rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 10 are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 11 (the second of the two paragraphs that are numbered 11) are rejected as being unnecessary to the conclusions reached. The proposed findings of fact in paragraph 12 are adopted in part by the Recommended Order, and are rejected in part as being unnecessary to the conclusions reached. The following rulings are made on the proposed findings of fact submitted on behalf of the Respondent. The proposed findings of fact in paragraphs 1-5, 7-14 are adopted in material part by the Recommended Order. The proposed findings of fact in paragraph 6 are adopted in part by the Recommended Order. The proposed finding that the contract was dated May 5, 1987, is rejected as being contrary to the finding that the contract was dated April 1, 1987. The proposed findings of fact in paragraphs 15 and 16 are rejected as being unnecessary to the conclusions reached. COPIES FURNISHED: James Gillis, Esquire Department of Professional Regulation Senior Attorney 400 West Robinson Street P. O. Box 1900 Orlando, Florida 32802-1900 Norman Segall, Esquire Bentata Hoet & Associates & Zamora, Segall, Lacasa & Schere 3191 Coral Way - Third Floor Miami, Florida 33145 Darlene F. Keller Division Director Department of Professional Regulation Division of Real Estate 400 West Robinson Street P. O. Box 1900 Orlando, Florida 32801 Kenneth Easley General Counsel Department of Professional Regulation 1940 North Monroe Street Suite 60 Tallahassee, Florida 32399-0792
Findings Of Fact Peter P. Sedler, at all times material to the complaint, has been licensed as a real estate broker, holding license 0079017. He was last licensed as a broker c/o Marshall & Sedler, Inc., 7771 St. Andrews, Lake Worth, Florida 33467. Marshall & Sedler, Inc., at all times relevant to the complaint, had been registered as a Florida real estate broker, holding license 0250511, its last licensed address was 7771 St. Andrews, Lake Worth, Florida 33467. Peter P. Sedler was the qualifying broker and officer for Marshall & Sedler, Inc. On about July 3, 1987, Tom Teixeira was employed as a salesman by Cartier Realty, of 11852 42nd Road North, Royal Palm Beach, Florida. Cartier Realty had solicited, through a direct mailing, listings for property in the Royal Palm Beach area. Ms. Mary Myers, an older woman of about 70 years of age, responded to the advertisement, and gave Mr. Teixeira an open listing for real property which she owned. While Mr. Teixeira placed a Cartier Realty "For Sale" sign on the property, the sign was somehow removed shortly thereafter, and no party dealing with Ms. Myers during the months of July, August and September of 1987 would have been placed on notice that Cartier Realty had any listing on the property. Mr. Sedler had nothing to do with the disappearance of the sign. Ms. Myers had originally acquired the property from her daughter. Long before Ms. Myers gave a listing to Cartier Realty, William Kemp and his wife Gina DiPace Kemp had told Ms. Myers that they were interested in purchasing the property, which is adjacent to the home of Mr. and Mrs. Kemp. When Mr. and Mrs. Kemp first contacted Ms. Myers, she had wanted to keep the property, in the belief that she might eventually convey it back to her daughter. Mr. Teixeira brought to Ms. Myers an offer from David R. and Maureen C. Rose to purchase the land for $11,900. Ms. Myers did not accept that offer, but the Roses accepted Ms. Myers' counteroffer on July 24, 1987, to sell it for $12,300. The sale was contingent upon the buyers obtaining financing; they applied for a loan, and ordered both an appraisal and a survey. The closing was to be held by September 1, 1987. (Contract, paragraph VI.) The closing date passed, without the buyers obtaining the necessary financing, so the contract was no longer effective. On about September 8, 1987, Mr. Teixeira attempted to contact Ms. Myers. He had obtained no written extension of the contract but hoped the sale might yet close. Ms. Myers told Teixeira that she was still willing to sell the property to Mr. and Mrs. Rose. In the meantime, Mr. and Mrs. Kemp became aware that Ms. Myers wanted to sell the property, because they noticed Mr. and Mrs. Rose coming to look at the land, and had engaged them in conversation. Ms. Kemp then contacted Ms. Myers to remind her that they were still willing to purchase the property, and also to say that they would offer more than the current offer on the property. On about September 11, 1987, Ms. Kemp contacted Cartier Realty to say that she also wished to make an offer on the Myers' lot. For a reason which was never adequately explained at the hearing, Teixeira, who should have been working on behalf of the seller, refused to take the offer, even though it was for a higher price. After this rebuff by Teixeira, Ms. Kemp contacted Marshall & Sedler, Inc., in order to try to find a broker who would convey their offer to Ms. Myers and spoke with Patricia Marshall, Ms. Marshall referred her to her partner, Peter Sedler. The Kemps told Sedler that Ms. Myers had told them that she had received a $9,000 offer on the lot. Why Ms. Myers told the Kemps that the Rose offer was $9,000 is not clear, for the actual offer had been $12,300, but Sedler did not know this. There was no listing of the lot in the local board of realtors multiple listing service book, and Mr. Sedler found the address of Ms. Myers through the public records. Mr. Sedler knew from his conversations with Ms. Kemp that Cartier Realty had some involvement with an offer on the property. He called Cartier Realty and tried to speak with the broker handling the matter. He spoke with a man named Tom, who he thought was a brother of the owner of Cartier Realty, Pete Cartier. Mr. Sedler actually talked with Tom Teixeira. Sedler believed he was dealt with rudely by Teixeira, who had hung up on him. Sedler then called Pete Cartier directly to find out whether there was an outstanding contract on the property, and Cartier told Sedler that he would call Sedler back. When Cartier called Sedler, Cartier warned Sedler that he should stay out of the deal. Mr. Sedler became suspicious about Cartier Realty's failure to bring a higher offer to the attention of the seller, and on September 16, 1987, filed a complaint against Tom Cartier with the Lake Worth Board of Realtors. Mr. Sedler then traveled to Pompano Beach to meet with Ms. Myers at her home, and brought with him a contract for sale and purchase of the property, already signed by the Kemps and dated September 14, 1987. While at the door, Ms. Myers asked Peter Sedler if he was "Tom." Ms. Myers knew that she had been dealing with a "Tom" at Cartier Realty, but all her dealings were on the phone, and she did not know what Tom Teixeira looked like. Sedler replied "Yes, but you can call me Pete." Sedler merely intended the comment as humor. At that time Sedler gave Ms. Myers his pink business card and specifically identified himself as Pete Sedler of Marshall & Sedler, Inc. Mr. Sedler asked Ms. Myers if she had any paperwork, such as the prior contract for the sale of the lot which had expired on September 1, 1987, but she did not. While Sedler was with Ms. Myers, she agreed to sell the property to the Kemps for $12,500 and signed the Kemp contract. The Kemps had put the purchase price of $12,500 into the Marshall & Sedler escrow account. Three days later, on September 18, 1987, Mr. Sedler, in the company of his wife Bonnie, presented a post-dated check to Ms. Myers in the amount of $11,020, the net amount due to Ms. Myers for the lot, based on the purchase price of $12,500. When they met this second time he introduced himself again as Pete Sedler and offered Ms. Myers his card for a second time. The post-dated check was conditioned by an endorsement making it good upon a determination that the title to the lot was good. A quit claim deed to Mr. and Mrs. Kemp was executed by Ms. Myers and witnessed by Bonnie Sedler. The post-dated check was given to Ms. Myers because she was about to leave on vacation. The check was given as a sort of security for good title, in return for the quit claim deed which closed the transaction. Mr. Sedler had structured the transaction in this way because he was concerned that someone at Cartier Realty might also attempt to purchase the property from Ms. Myers on behalf of one of their clients. At that time, Mr. Sedler held the reasonable belief that no other party had a subsisting contract to purchase the property from Ms. Myers. Sedler had no reason to believe the Roses would or could pay more for the property than the Kemps offered. Ms. Myers knew that Tom Teixeira from the Cartier realty firm represented a distinct business entity from Marshall & Sedler or Pete Sedler. After a title search showed that Ms. Myers had clear title to the property, the check which Mr. Sedler had given to Ms. Myers on September 18, 1987, with the restrictive endorsement was replaced. Later Mr. and Mrs. Rose tried to close their purchase, but found they could not. Ms. Myers had failed to inform them of the sale she made to the Kemps through Mr. Sedler. Mr. Teixeira, in retribution, filed an ethics complaint about Mr. Sedler with the West Palm Beach Board of Realtors.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Administrative Complaint against Peter P. Sedler and Marshall & Sedler, Inc., be dismissed. RECOMMENDED this 14th day of March, 1991, at Tallahassee, Florida. WILLIAM R. DORSEY, JR. 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 14th day of March, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-6183 Rulings on findings proposed by the Department: 1. Rejected as unnecessary. 2 and 3. Adopted in Finding 1. 4 - 6. Adopted in Finding 2. Adopted in Finding 3. Adopted in Finding 3. Implicit in Finding 5. Adopted in Finding 5. Adopted in Finding 5. Adopted in Finding 5. Adopted in Finding 5. Adopted in Finding 6. Implicit in Finding 6. This does not mean that the contract subsisted, however. Rejected. Ms. Myers was willing to sell the property to Mr. and Mrs. Rose after the contract expired, but she was not under any obligation to do so. Adopted in Finding 7. Rejected, because there was no pending contract. Teixeira never obtained a written extension of the closing date and Ms. Myers was free to sell elsewhere. Rejected. No one could have truthfully told Sedler there was a pending contract. None existed. Rejected, because Mr. Sedler had no reason to believe that there was a subsisting contract for the sale of the property; there was none. Admission number 20 is not to the contrary. Adopted in Findings 10 and 11. Rejected. See, Findings 9 and 10. Rejected as unpersuasive. Rejected as cumulative to Finding 9. Adopted in Finding 14. Adopted in Finding 11. Rejected as unnecessary. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation Post Office Box 1900 Orlando, Florida 32802-1900 Frank W. Weathers, Esquire Frank W. Weathers, P.A. Post Office Box 3967 Lantana, Florida 33465-3967 Darlene F. Keller, Division Director Department of Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, Florida 32801 Jack McRay, General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue Whether Respondent, a certified general contractor, violated the construction industry licensing law, by: (1) acting in the capacity of a contractor under a name other than as set forth on his certificate; (2) diverting construction funds resulting in his unwillingness or inability to perform pursuant to a construction contract; and (3) abandoning three construction projects, and if Respondent is guilty of such violations, the appropriate disciplinary penalty which should be imposed by the Construction Industry Licensing Board. Conclusions and Recommendation Conclusions: Respondent is guilty of the charges that he (1) acted in the capacity of a contractor under a name other than as set forth on his certificate, and (2) abandoned a single construction project; he is not guilty of the charges that he abandoned two other projects, and diverted construction funds which resulted in his unwillingness, or inability to perform pursuant to a construction contract. Recommendation: That Respondent's certified general contractor's license be SUSPENDED until such time as Respondent furnishes to the Board satisfactory evidence of having made restitution to purchasers entitled to the return of their deposits made pursuant to Hands High Ranchettes and Bass Creek of Boynton residential purchase agreements.
Findings Of Fact Respondent Fuller holds a currently active certified general contractor's license, no. CG C009750. Fuller is authorized by his certification to perform contracting only under his proper name, or the name of Bass Creek Corporation. (Testimony of Kehr, Fuller) At all times material hereto, Fuller was a general partner in two Florida limited partnerships: Bass Creek of Boynton Associates, Ltd. and Hands High Ranchettes, Ltd. These partnerships attempted to develop and construct two residential subdivisions in Palm Beach County -- Hands High Ranchettes and Bass Creek. In furtherance of this undertaking Fuller, or his agents, executed written contracts to sell lots within the developments and construct residences thereon. The Board alleged, and presented evidence at hearing for the purpose of establishing, that Fuller violated Chapter 468, Florida Statutes (1978) by his actions relating to contracts executed with three individuals -- Muriel F. Mason, Rozeanne E. White, and George C. Mitchell. (Testimony of Mason, White, Fuller, Petitioner's Exhibits 1 - 6). [AS TO MURIEL F. MASON] On September 10, 1978, Hands High Ranchettes, Ltd. entered into an Agreement of Purchase of Sale with Muriel F. Mason. By this agreement, Mason agreed to purchase a lot, with residence to be constructed thereon, in the Hands High Ranchettes residential development. The contract purchase price was $75,930.00. By January, 1979, Mason had paid into the Hands High Escrow Account, pursuant to the contract, an initial deposit of $3,915.00. (Testimony of Mason, Fuller, Petitioner's Exhibits 5, 6) Early in 1979, the bank rejected her application for a mortgage loan to finance purchase of the property. Consequently, under the contract, Fuller was not required to commence construction on the property. Moreover, Mason subsequently notified Hands High Ranchettes that she no longer wished to proceed with the contract, and requested return of her initial deposit. Under such circumstances, the purchase contract requires, and Fuller admits, that Mason is entitled to the full return of her $3,515.00 deposit. (Testimony of Mason, Fuller, Petitioner's Exhibit 5). During early July, 1979, Fuller notified Mason that 1e intended to return her $3,815.00 deposit, and that he would send her a letter to that effect. Fuller has recently earned substantial monies by selling land and completing a construction project which should enable him to return Mason's deposit no later than October, 1980. (Testimony of Mason, Fuller) [AS TO ROZEANNE WHITE] On August 19, 1975, Hands High Ranchettes, Ltd. entered into a similar Agreement of Purchase of Sale with Rozeanne White, aid her husband. By the agreement, White agreed to purchase a lot, with residence to be constructed thereon, in the Hands High Ranchettes subdivision. The purchase price was $75,000.00. By March, 1979, pursuant to the agreement, White had paid into the Hands High Ranchettes Escrow Account a $7,500.00 initial deposit. (Testimony of White, Fuller, Petitioner's Exhibit 1) In March, 1979, White obtained the necessary mortgage loan to finance purchase of the lot and construction of the residence. Hands High Ranchettes, however, except for clearing the lot and constructing foundation forms, never constructed the residence specified in the Purchase Agreement. (Testimony of White, Fuller). In July, 1979, Fuller told White that due to severe financial problems associated with the development, he would be unable to construct her residence, and would refund her deposit within thirty days. Fuller's failure to timely construct the residence imposed a severe burden on White and her family. In anticipation of her new home being built, she had sold her existing residence. When the new residence was not constructed, she had to move her family into an 18' travel trailer for seven weeks during the summer. At the time she was pregnant, and was accompanied by her husband and two children. After Fuller failed to return her deposit, she filed a suit for damages and obtained a civil judgment against Hands High Ranchettes, Fuller, and Bass Creek Corporation for $43,000.00. In satisfaction of the judgment she ultimately accepted a settlement offer of $10,000.00 plus attorney fees. (Testimony of White) [AS TO GEORGE MITCHELL] On April 28, 1979, George Mitchell and his wife entered a similar Agreement of Purchase of Sale with Fuller's other limited partnership -- Bass Creek of Boynton Associates, Ltd. The agreement covered the purchase of a lot and construction of a new residence in the Bass Creek subdivision. The purchase price was $68,301.00 and, pursuant to the contract, Mitchell paid an initial deposit of $1,001.00 (Testimony of Fuller, Petitioner's Exhibit 2). Due to no fault of Mitchell's, the residence specified in their agreement was never constructed. Fuller admits that he defaulted on his obligation under the Agreement of Purchase and that Mitchell is entitled to the refund of his $1,001.00 initial deposit. (Testimony of Fuller, Petitioner's Exhibits 3, 4) [ACTIONS OF GEORGE FULLER] Fuller, d/b/a Hands High Ranchettes, Ltd. and Bass Creek of Boynton Associates, Ltd. used the initial deposits received under the Purchase Agreements with Mason, White, and Mitchell to pay for clearing the lots, constructing foundation forms, and associated engineering and architectural fees. (Testimony of Fuller) Fuller, by his own admission, failed to perform his contractual obligation to return the initial deposits to Mason, White, and Mitchell. He promises to refund, by the end of October, 1980, any deposit monies due Mason, White, Mitchell, and other persons who entered into agreements to purchase land and construct residences within the two subdivisions. Fuller's failure to perform his contractual obligation to convey lots and construct the promised residences is not due to unwillingness or bad faith on his part, or a motive to avoid his contractual responsibilities. Rather, it is due to serious and complex financial difficulties he encountered in developing the two residential subdivisions. The two events primarily responsible for these financial difficulties were: (1) another party's breach of its contractual obligation to construct road improvements within the subdivisions; and (2) failure of the limited partner in these two ventures, Housing Capital Corporation of Washington, D.C., to furnish, as promised, $650,000.00 in interim development funds. In an effort to complete the developments, Fuller expended virtually all of his personal assets. (Testimony of Fuller) Fuller has engaged in general contracting for over forty years; charges have never before been brought against him in connection with his construction activities. For approximately twelve years he constructed numerous buildings for the Catholic Diocese of Brooklyn, N.Y. and has a wide range of experience in constructing schools, commercial buildings, residences, and apartment buildings. Since obtaining his Florida license, he undertook and successfully completed a 153-home residential development in Delrey Beach, Florida. His professional livelihood and economic well-being are dependent on his continued ability to engage in general contracting. (Testimony of Fuller).
