The Issue Whether Respondent violated Sections 475.25(1)(b), 475.25(1)(d)2, and 475.25(1)(e), Florida Statutes (1998 Supp.), and 475.42(1)(b), Florida Statutes, and, if so, what discipline should be imposed.
Findings Of Fact At all times material to this proceeding, William A. Morrisey was a licensed Florida real estate salesperson, issued license number 0607918 by the Department in accordance with Chapter 475, Florida Statutes. On June 10, 1999, Morrisey, as a partner of W.M. #1, executed a contract to purchase real property located at 108 Westwind Court, Sanford, Florida. The sellers were William and Arlene Carlock. The sellers were represented by Stephen Wheeler (Wheeler) with Penne Brokers, Inc. Morrisey identified himself in the contract as a licensed real estate salesperson with Real Estate Professionals of America. Morrisey was engaged in a personal real estate transaction and was not operating as a salesperson for Real Estate Professionals of America. Bill Paisley (Paisley) of Real Estate Professionals of America was the real estate agent for Morrisey and made the original offer on behalf of W.M. #1 to purchase the property. Paisley represented to Wheeler that the purchase would be a cash transaction and that Morrisey was buying the property for a profit. The Carlocks and Morrisey agreed to close on the property before the end of June 1999. Morrisey was unable to close before the end of June and asked for an extension of time until July 5, 1999. Wheeler began to communicate directly with Morrisey when problems arose about the closing date. Morrisey explained to Wheeler that he would not be paying cash for the property because he was going to sell the property to Keandra Brown. On July 5, Mr. and Mrs. Carlock went to Abstractors Title Company of Central Florida (Abstractors Title) for the closing. Mr. Morrisey did not show for the closing because Ms. Brown did not have the mortgage. Mr. Carlock left the keys to the house with Abstractors Title so that Morrisey could use the keys to do a final inspection on the house to make sure that the agreed- upon repairs were completed. Abstractors Title gave the key to Morrisey to do the final inspection. The closing was rescheduled for August 4, 1999. Mr. and Mrs. Carlock came to the closing as well as Morrisey. The parties signed the closing papers, but Morrisey did not have the funds to close the transaction. He asked Alphonse Cheneler with Abstractors Title to disburse the proceeds from a transaction that had not transpired (Morrisey's sale of the Carlocks' house to Ms. Brown) so that Morrisey could use those funds to complete his purchase of the property from Mr. and Mrs. Carlock. Mr. Cheneler advised Morrisey that he could not do that. Morrisey also wanted Mr. Cheneler to disburse the funds from the Morrisey-Brown closing so that Morrisey could deposit some money in Ms. Brown's banking account to fulfill a lender requirement that she have a certain amount of money in her bank account. Mr. Cheneler told Morrisey that he felt that would be bank fraud and he would not do it. Morrisey offered Cheneler $1,000 and a watch if Cheneler would disburse the funds. Cheneler refused. Morrisey advised Wheeler on August 4, 1999, that he would have the funds within a couple of days, but Morrisey never brought the funds and the closing was never completed. On August 4, 1999, Wheeler went to the property that was for sale, and found that Keandra Brown had moved into the house without the knowledge or consent of the owners. Wheeler told Ms. Brown that she would have to leave the property because Morrisey had not closed on the property. Morrisey came to the property while Wheeler was there and verbally threatened Wheeler, saying he would remove Wheeler from the property if Wheeler did not leave. Mr. Carlock hired an attorney and started eviction proceedings to have Ms. Brown evicted from the premises. Ms. Brown moved out of the house on August 18, 1999. The contract required Morrisey to place a $1,000 deposit with the law firm of Swann, Hadley, & Alvarez. Morrisey did not place the $1,000 in an escrow account with Swann, Hadley, & Alvarez. By letter dated August 11, 1999, a representative of Swann, Hadley, & Alvarez advised Wheeler that Morrisey had never placed the money in an escrow account with Swann, Hadley, & Alvarez. Morrisey never placed the $1,000 with either Penne Brokers, Inc., or Real Estate Professionals of America. A complaint was filed with the Department concerning Morrisey's actions in the real estate transaction at issue. An investigator for the Department sent a letter to Morrisey on September 20, 1999, notifying Morrisey that a complaint had been filed against him. Morrisey contacted the investigator and told the investigator that he would send the investigator some documents by facsimile transmission. Morrisey never sent the documents. Morrisey again called the investigator and scheduled an appointment for November 16, 1999, but Morrisey never appeared for the appointment. The investigator left a voice mail message for Morrisey, but Morrisey never replied. A second notification letter was sent to Morrisey, and Morrisey called and scheduled another appointment. Morrisey met with the investigator on December 13, 1999. Morrisey advised the investigator that he did ask Abstractors Title to close on the Morrisey-Brown transaction prior to closing on the Carlock-Morrisey transaction so that Morrisey could use the proceeds from the Morrisey-Brown transaction to close on the Carlock-Morrisey transaction. Morrisey also advised that he did not make the $1,000 deposit at Swann, Hadley, & Alvarez. Mr. and Mrs. Carlock sold the property to another buyer on February 1, 2000.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered dismissing Count I of the Administrative Complaint, finding that William A. Morrisey violated Sections 475.25(1)(b) and 475.25(1)(d)2, Florida Statutes (Supp. 1998), suspending his license for five years, imposing a $1,000 administrative fine for the violation of Section 475.25(1)(b), Florida Statutes (Supp. 1998), and imposing a $1,000 administrative fine for the violation of Section 475.25(1)(d)2, Florida Statutes (Supp. 1998). DONE AND ENTERED this 17th day of October, 2001, 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 17th day of October, 2001. COPIES FURNISHED: William A. Morrisey 1014 Fox Den Court Winter Springs, Florida 32708 Rania A. Soliman, Esquire Department of Business and Professional Regulation 400 West Robinson Street, Suite N-308 Hurston Building, North Tower Post Office Box 1900 Orlando, Florida 32801 Jack Hisey, Deputy Division Director Division of Real Estate Department of Business and Professional Regulation Hurston Building, North Tower Post Office Box 1900 Orlando, Florida 32801 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202
The Issue Whether Petitioner should be licensed as a real estate salesperson.
Findings Of Fact In June 1997, the Petitioner applied to the Respondent for a real estate salesperson license. The Petitioner disclosed on his license that he previously held a real estate broker's license which was revoked approximately ten years prior to his current application. The Petitioner also disclosed his criminal history on the application including a conviction in April 1988 for grand theft. The Respondent issued its Order, which took effect on October 7, 1997, denying the Petitioner's application for licensure. The reason given by the Respondent for the denial was: Your answer to Questions 9 and 13 of the licensing application and on your criminal record according to the appropriate law enforcement agency, . . . [.] The Petitioner asked the Respondent to reconsider its Order and the Respondent subsequently issued an Order, effective September 8, 1998, again denying Petitioner's application. The reasons given in the September 8, 1998, Order were identical to those stated in its prior order. At the hearing held in this cause the Petitioner introduced his Composite Exhibit No. 1 which comprised five letters of support from persons who know and have entered into business dealings with the Petitioner. The Petitioner also introduced an Amended Information from Duval County Case No. 87- 3000CF, CR-A, which was admitted into evidence as Petitioner's Exhibit No. 2 and Respondent's Exhibit No. 7(i). Petitioner's present employer, Kevin Vera, testified on behalf of the Petitioner. Mr. Vera, a retired dentist, has owned and operated a business known as River City Mortgage Services since January 1996. Mr. Vera is a lender correspondent. Mr. Vera testified that Robert Hunter has worked for him as a loan officer since January 1998. Mr. Hunter assists persons in obtaining loans by reviewing loan applications, analyzing credit reports, verifying that applicants have funds to close and verifying that applicants have income which will support the requested loan. Mr. Vera has not received any complaints from customers or lenders regarding Mr. Hunter. Mr. Vera was aware Robert Hunter had his real estate license suspended in 1987. He was also aware that Mr. Hunter had been convicted of grand theft in relation to a past real estate transaction. Mr. Vera considers Mr. Hunter to be honest and trustworthy. Gregory V. Blaylock also testified on behalf of Mr. Hunter. He met Mr. Hunter in 1993. At that time, he and Mr. Hunter were both salesman Colorado Choice Meat Company. Mr. Blaylock and Mr. Hunter sold frozen meat and seafood door-to- door. In 1987, Mr. Blaylock requested Mr. Hunter to work for him in his company, Coastal Meat and Seafood. The door-to-door meat sales industry lends itself to theft by salesmen, and he always found Mr. Hunter to be honest in his dealings. Mr. Blaylock was generally familiar with Mr. Hunter's past criminal history. He also was aware that Mr. Hunter's real estate license had been revoked. Mr. Blaylock followed Mr. Hunter as a loan officer at Kevin Vera's office. Mr. Blaylock found Mr. Hunter to be trustworthy and honest in all of their business endeavors. Mr. Evan Regas also testified in behalf of Mr. Hunter. He has been in the real estate business for 46 years. He has known Mr. Hunter for approximately 23 years. Mr. Hunter worked for Mr. Regas when the Petitioner first obtained his license. Mr. Regas is familiar with the facts of Mr. Hunter's past revocation and his criminal history. Mr. Regas testified that he considers Mr. Hunter to be trustworthy and honest. Mr. Hunter has recently participated in real estate transactions with Mr. Regas' clients in Hunter's capacity as a loan officer. Ms. Cynthia Smith also testified on behalf of the Petitioner. She formerly worked as closing officer for a real estate title company. She presently works as a loan officer for Mr. Vera's firm. She is familiar with Robert Hunter's background. She considers Mr. Hunter to be honest and trustworthy. All of Petitioner's witnesses testified that they stood by their letters of recommendation contained in Petitioner Exhibit No. 1. Robert Hunter testified. He has been married for 29 years. He has resided in his present residence for three and one-half years and has never missed a payment. He has good credit. After his real estate license was revoked, Mr. Hunter worked as a door-to-door meat and seafood salesman from 1987 until he commenced working as a loan officer for River City Mortgage. Mr. Hunter was never disciplined by the Commission for any matter connected with his activities as a real estate salesperson or broker. The activities for which his license was revoked were largely caused by a down turn in the real estate market and increased interest rates. Mr. Hunter stated that he learned from the past and that he would not enter again into highly leveraged transactions. He has learned that he needs to consider the effect his actions have on others. Mr. Hunter testified regarding the incident which lead to his entering a plea of nolo contendere in Duval County Case No. 87-3000CF, CR-A. This incident stemmed from investors calling in obligations which he could not pay due to the stagnant real estate market and then high interest rates. This incident regarded a complex multiple real estate transaction involving Mr. Hunter's residence. The purchaser of Mr. Hunter's residence, who was one of the individuals pressing charges, reneged on paying for the house belonging to Petitioner, in which the purchaser was residing, because of fears that Petitioner could not deliver good title. The rest of the multiple transaction failed when the purchaser of his home reneged. The Petitioner entered a plea of nolo contendere to the charges arising out of this scenario as a plea of convenience. Petitioner's Exhibit 2, Respondent's Exhibit 7(i), shows that the events at issue in that case preceded the Board's revocation of his license.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is RECOMMENDED: That the Commission license the Petitioner as a real estate salesperson. DONE AND ENTERED this 9th day of April, 1999, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN 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 9th day of April, 1999. COPIES FURNISHED: Michael R. Yokan, Esquire 204 Washington Street Jacksonville, Florida 32202 Andrea D. Perkins, Esquire Division of Real Estate Department of Business and Professional Regulation Suite S-107 400 West Robinson Street Orlando, Florida 32801 Herbert S. Fecker, Division Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 William Woodyard, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
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.
The Issue Is Respondent guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence and breach of trust in a business transaction in violation of Section 475.25(1)(b), F.S.? Is Respondent guilty of having failed to account or deliver to any person a deposit in violation of Section 475.25(1)(d), F.S.?
Findings Of Fact Petitioner is the state government licensing and regulatory agency charged with the responsibility and duty to prosecute administrative complaints pursuant to the laws of the State of Florida, in particular Section 20.30, Florida Statutes, Chapters 120, 455, and 475, Florida Statutes, and rules promulgated thereunder. Petitioner's Exhibit 5 establishes that Respondent was licensed as a real estate broker from 1978-March 31,1982, having been issued license number 0004238; that she applied for a change of address on July 30, 1985; and that she also was licensed effective April 1, 1986 in accordance with Chapter 475 F.S. Respondent's Answer, served September 4, 1987, states, in pertinent part, "Respondent admits she is a licensed real estate broker." The last license issued was as a broker t/a Mary L. Barrett, Real Estate, 235 S. County Road, Palm Beach, Florida, 33480. Pursuant to oral testimony of Manley P. Caldwell, Jr., an attorney, the following occurred: Respondent owned an apartment building consisting of nine residential units located at 301 Chilean Avenue, Palm Beach, Florida. A condominium conversion was completed February 19, 1983, but recorded thereafter. Respondent sold the property (all nine units) to the condominium corporation, "301 Chilean Corp."; and Respondent took as payment for her property the proceeds of a $300,000 Florida National Bank mortgage on the property. The deeds, sale papers, accountings, corporate papers, conversion documents, and $300,000 mortgage and note by the corporation to Florida National in support of Mr. Caldwell's testimony were not offered in evidence either through Mr. Caldwell, through a records custodian, or by submitting certified copies. Without some authenticated supportive documentation, Mr. Caldwell's testimony as to the nature and dates of this corporate real estate transaction is uncorroborated hearsay. To the degree there is any documentary corroboration, it appears to fix a far later date than that recited by Mr. Caldwell. 1/ Even so, neither Mr. Caldwell's testimony nor any admitted documentary evidence supports the premise that Respondent acted as other than a seller of her own real property in this transaction. There is no evidence she acted as a real estate agent or broker between independent parties. According to Mildred Chrzanowski, previously, on or about May 17, 1982, Respondent had made representations to her that if Mrs. Chrzanowski invested in the residential units, Respondent would form a corporation and convert the building into a condominium project, that Mrs. Chrzanowski would receive a position in the 301 Chilean Corp., that she would get a return of the $30,000 she invested at the "closing" to take place in October, 1982, that she would eventually get back double her investment, and that Respondent would pay back all the money herself if necessary. Five checks were made out by Mrs. Chrzanowski directly to the Respondent and not to any corporation. They also were tendered directly to the Respondent between May 17, 1982 and January 24, 1983. These five checks totalled $30,000 and were intended to purchase stock in the corporation. Some of these checks are endorsed in Respondent's name; some are endorsed for deposit only to the Respondent's name; some are endorsed for deposit only to the corporation. Mrs. Chrzanowski testified that she made out the first five checks to the Respondent because she thought the corporation was not yet formed as of January 24, 1983, the date of the fifth check. However, there is nothing to show these amounts were used for other than the incorporation and condominium conversion. A sixth check, dated January 18, 1984 for $1,360 constituted a loan by Mrs. Chrzanowski to the corporation. Mrs. Chrzanowski testified that she expected to become treasurer of the corporation and through her testimony Petitioner's Exhibit 2 was admitted in the absence of Respondent without objection. This is a copy of a federal corporate income tax return (dated September 20, 1983) for "301 Chilean Corp." and reflecting that the corporation was incorporated June 1, 1982, and "activated" May 11, 1983. It does not recognize Respondent as a stockholder. It names Mr. and Mrs. Chrzanowski, Joanne Barrett, and McKinley Cheshire as stockholders of a total of 83.33 shares of stock. It does not recognize Respondent or anyone else as a corporate officer. Indeed, the copy admitted in evidence is unsigned, and although Mrs. Chrzanowski testified that it was in her care, custody, and control, she apparently did not prepare it or know who had prepared it. The form reflects preparation by a firm of Certified Public Accountants. Mrs. Chrzanowski testified that she never got any accounting books for the corporation, never saw any of its checkbooks or purchases, and was never issued any stock, but that she did attend some unspecified meetings at Florida National Bank. Mrs. Chrzanowski eventually asked Respondent for return of her money. Although one is left with the impression Mrs. Chrzanowski got back $30,000 somehow, it is unclear from her testimony whether Mrs. Chrzanowski got back her $30,000 investment. She is, however, clear in her testimony that she did not recover the $1,360 corporate loan paid by her January 18, 1984 check made out to the corporation, delivered to Respondent, and endorsed for deposit only to the corporation. She is likewise clear that she did not double her $30,000 investment. She is most upset that her money did not double, that Respondent referred her to a lawyer to get the corporate books, and that eventually Respondent did not take her phone calls. Respondent had also promised Dr. McKinley Cheshire that he would serve as the corporate president of "301 Chilean Corp." He testified that he gave Respondent $15,000 plus other monies to support the project, and presumably to buy stock. No documentation of these payments was introduced in evidence, but Dr. Cheshire testified, contrary to the unsigned tax return, that he got no stock and no formal corporate meetings were held. Nonetheless, he also represented that at one meeting, May 10, 1983, at Florida National Bank, he discovered that he would have to sign a personal guarantee. Dr. Cheshire was not asked to identify his signature, but based upon copies of certain individual unit mortgage deeds and notes introduced in evidence through the testimony of Mr. Scatigno (P-7), it may be inferred that Dr. Cheshire signed several notes and mortgages as corporate President and signed a personal guarantee as to one note which was also personally guaranteed by Mr. and Mrs. Chrzanowski on August 22, 1983. Dr. Cheshire eventually recovered $7500 out of the corporation. Although Dr. Cheshire thinks he got his money when someone was trying to "take over" the corporation, there is no clear explanation of how he could have recovered $7500 without any stock transfer. Dr. Cheshire testified that it was orally agreed that Respondent was to act as the manager and sales agent for the condominium units. Mrs. Chrzanowski and Dr. Cheshire concur that in this capacity Respondent showed them that she had made some unit sales. There is no documentation in evidence to show upon what terms Respondent was to act as manager and sales agent or during what period of time. Dr. Cheshire's testimony is inconclusive to support either a finding that he made a request as an individual or as corporate President to Respondent as manager and sales agent for an accounting or for a refund of the money arising from these unit sales. Franco Scatigno is an Italian national. He first met Respondent through his brother and later sought her out as a real estate agent because he was interested in investing money in the United States. His perception is that after their first meeting, Respondent aggressively solicited his business and secured him as a purchaser for several of the individual units at 301 Chilean Avenue. On or about March 27, 1984, Respondent solicited Mr. Scatigno as a purchaser for unit 7, at a sales price of $75,000.00. Mr. Scatigno stated he paid $15,269.37 as a down payment to Respondent. This is the amount reflected in the body of the Agreement for Deed, apparently signed by McKinley Cheshire, President for seller, 301 Chilean Corp., as the down payment. The Agreement for Deed acknowledges this amount of down payment was received by the sellers for that unit. However, none of the copies of checks admitted in evidence (P-3 and P-4) is for that amount. Putting the best light on this discrepancy in Mr. Scatigno's testimony with regard to these figures, and recognizing that Mr. Scatigno sometimes referred to any dollar amount not given in "round thousands" as, "so many thousands and change," the figures still fall short of being wholly reconciled. The money distribution listed on the bottom of this Agreement for Deed for unit 7 totals $15,000. Two cashier's checks in the respective amounts of $8,574.15 for Charles Meyer and $6,425.85 for Mary Barrett (Respondent), totalling $15,000, were issued by Florida National Bank on Franco Scatigno's account on March 26, 1984. An attachment to this Agreement for Deed sets out that Mr. Meyer and Respondent had previously paid $15,000 to 301 Chilean Corp. for this unit. Without a closing statement or something more, it is impossible to conclude that more than $15,000 changed hands on this transaction and without something more, it is only by pure speculation that these amounts can be attributed to the unit 7 transaction. Again, it may be that Respondent was acting not as a real estate professional but as a private seller in this transaction. On or about the same date, Respondent solicited and obtained Mr. Scatigno as the purchaser at a sales price of $33,000 for unit 4 owned by William and Rheta Norman. Mr. Scatigno stated he entrusted a $5,126.77 down payment to Respondent, which is the amount reflected in the applicable Agreement for Deed, but no check exhibit corresponds to this amount either. On or about the same date, Respondent solicited and obtained Mr. Scatigno as the purchaser for unit 3, owned by Joanne Barrett (see supra.), at a sales price of $75,000.00. Mr. Scatigno stated he entrusted a $15,269.37 down payment to Respondent, but again no check exhibit corresponds to that precise amount. A cashier's check in the amount of $15,000 was drawn on Franco Scatigno's account for Joanne Barrett on March 26, 1984. For each of the foregoing three transactions, Mr. Scatigno received an executed Agreement for Deed for the unit involved. Each Agreement for Deed acknowledges receipt by the seller(s) of the respective amounts of down payment related orally by Mr. Scatigno. The Agreements for Deed also each specified, in pertinent part, that the purchaser (Scatigno) would pay to the respective unit's seller(s) a monthly installment equal to the respective seller's/sellers' monthly mortgage debt to the mortgagee, and that the respective seller(s) would, in turn, be responsible for timely paying mortgage payments to the mortgagee. The pay out dates for each transaction/mortgage was specified, the earliest being August 22, 1988. The Agreements for Deed are silent as to who (purchaser or seller) was responsible for recording them or if they were to be recorded at all. No evidence was offered as to the law or responsibility by trade, custom, or professional standard as to whether Respondent, as a real estate professional, was responsible for recording them. Mr. Scatigno testified that he entered into an oral agreement with Respondent to manage these three units plus one other. There is no documentation to show what the terms of this agreement may have been or what its duration was intended to be. With regard to the fourth unit, approximately March 27, 1984, Franco Scatigno agreed to purchase unit 5 from 301 Chilean Corp. A contract for sale (P-4) was drawn up for $90,000 with $15,267.62 as principal and $74,732.38 in mortgage, $2,000 deposit to the corporation, and no broker's commission. Pursuant to this exhibit, on September 1, 1984, the corporation was to be required to deliver an Agreement for Deed to Mr. Scatigno and Mr. Scatigno was to be required to deliver a note due to the corporation. Mr. Scatigno testified contrariwise that he expected to get the Agreement for Deed from Respondent in November 1984. Regardless of what Mr. Scatigno thought was agreed to or what the terms of the contract for sale (P-4) actually provided, it appears to be merely an "offer" by Scatigno without an "acceptance" on the signature line for the seller, 301 Chilean Corp. Mr. Scatigno was of the opinion that he never received the Agreement for Deed for this unit. However, he claims to have paid out money and relied on Respondent to rent the unit, and thereafter, the foreclosure papers on the unit name him as holding an Agreement for Deed thereon. The Administrative Complaint alleges that Mr. Scatigno was misled by Respondent to believe he was getting four Warranty Deeds instead of four Agreements for Deed. The evidence does not support this allegation. The three Agreements for Deed offered and admitted in evidence at formal hearing were signed by Mr. Scatigno and they set out that Warranty Deeds would be transferred to him by the sellers, provided all payments by all parties were fully paid, and at such time as these amounts had been fully paid, pursuant to the respective Agreements, each of which was scheduled to pay out in 1988. Although Mr. Scatigno thinks he never got an Agreement for Deed for unit 5, the bank which eventually foreclosed that unit in 1986 against 301 Chilean Corp. and Mr. Scatigno alleged in the foreclosure pleadings that Mr. Scatigno held an interest in the unit by Agreement for Deed. Respondent is not charged in this instant disciplinary action with failure to deliver a fourth Agreement for Deed. Clearly, Mr. Scatigno, as a foreign national, is not familiar with the legal differences among, and qualities of, Contracts for Sale, recorded and unrecorded Agreements for Deed, and Warranty Deeds. However, the only representations about the legal effect of his Agreements for Deed that Mr. Scatigno related at formal hearing were those made by an unidentified "lawyer" he apparently consulted at the closing. 2/ Mr. Scatigno at one point testified that he was personally required to make the mortgage payments on the four units and at another point testified that Respondent told him to make out blank cashier's checks for the appropriate amounts and thereafter Respondent made out these checks on his behalf to pay the respective unit mortgages. He also testified that Respondent was supposed to have the mortgage or mortgages at the bank switched to his name, but from his testimony it is not possible to be sure whether this latter information was a representation by Respondent directly contrary to the provisions in the Agreements for Deed which Mr. Scatigno is presumed in law to have agreed to when he signed them or whether it was Mr. Scatigno's unilateral perception of what should be done, which perception is not attributable to any representation by the Respondent. Mr. Scatigno stated that Respondent induced him to buy all four units by telling him that once rented, he would realize an investment income of $1200 per month, per unit. Mr. Scatigno maintains that, pursuant to their oral agreement, Respondent was to manage and rent his units. Mr. Scatigno did not suggest that Respondent failed to transmit his payments to the mortgagee bank for so long as he paid through her. Rather, he produced cancelled checks to show that these payments were made until he chose to quit paying them, but he complained that Respondent failed to rent his units as promised. According to Mr. Scatigno, Respondent only rented one of his units on one occasion for two weeks at $400-500 per week, and another unit was rented for a short, unspecified period for $300 per week. Mr. Scatigno never saw any of this money, nor is it clear which units were rented or when. When Respondent did not rent all his units on a regular basis, Mr. Scatigno repeatedly urged her to do so. Thereafter, over a period from late 1984 through April of 1985, he urged her to either rent his units, resell his units, or let him out of his deal. She urged him to continue to pay management costs and the mortgage through her, but eventually, she did not answer either his letters or his phone messages left on her answering machine. Although the time frames testified to by Mr. Scatigno are imprecise, apparently Respondent ceased to communicate with him before he decided to stop paying the mortgage and upkeep on the property. However, Mr. Scatigno elected to stop paying the mortgages because he felt Respondent was not managing his property and also because he "could not continue to pay out $3,000 and change each month with nothing-coming in." The bank then foreclosed upon both Mr. Scatigno and the mortgagors/sellers of the respective units. He thinks he walked away from the foreclosure action without further debt because his Agreements for Deed were never recorded. It was not demonstrated that Respondent retained the rental money that is claimed by Mr. Scatigno. It may be as easily speculated that the Respondent applied it to the management of Mr. Scatigno's units or toward these units' respective mortgages as it may be speculated that she kept it. Foreclosure on all Mr. Scatigno's units and at least one other unit seems to have been completed in January 1986. Respondent is not charged with operating as a real estate professional without a license from March 31,1982 to April 1, 1986. A thorough search of the documentary exhibits reveals no further reconciliation of the discrepancies in the witnesses' testimony, and does not further clarify the ambiguities previously set forth.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is recommended that the Florida Real Estate Commission enter a Final Order dismissing all charges against the Respondent. DONE and RECOMMENDED this 19th day of October, 1988, at Tallahassee, Florida. ELLA JANE P. DAVIS, 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 19th day of October, 1988.
The Issue Whether Respondent committed the violations alleged in the Administrative Complaint issued against him and, if so, what penalty should be imposed.
Findings Of Fact Based on the evidence adduced at the "formal hearing," and the record as a whole, the following findings of fact are made: Respondent is now, and has been since October of 2000, a licensed real estate sales associate in the State of Florida, holding license number 695252. He is currently associated with AAA Realty, Inc., a broker corporation doing business in Broward County, Florida. From March 1, 2001, through June 26, 2001, Respondent was an active real estate sales associate with Allen Real Estate, Inc. (Allen), a broker corporation doing business in St. Lucie County, Florida. From June 27, 2001, through August 13, 2001, Respondent was an active real estate sales associate with Realty Unlimited, Inc. (Unlimited), a broker corporation (affiliated with GMAC Real Estate) with offices in Port St. Lucie and Stuart, Florida. Unlimited is now, and has been at all times material to the instant case, owned by Kevin Schevers, a Florida-licensed real estate broker. Gary Sprauer is a Florida-licensed real estate sales associate. He is currently associated with Unlimited. Like Respondent, Mr. Sprauer began his association with Unlimited on June 27, 2001, immediately after having worked for Allen. Respondent and Mr. Sprauer worked as "partners" at both Allen and Unlimited. They had an understanding that the commissions they each earned would be "split 50-50" between them. On February 7, 2001, Allen, through the efforts of Respondent and Mr. Sprauer, obtained an exclusive listing contract (Listing Contract) giving it, for the period of a year, the "exclusive right to sell," in a representative capacity, commercial property located at 3800 South Federal Highway that was owned by Vincent and Renee Piazza (Piazza Property). Paragraphs 6 and 7 of the Listing Contract addressed the subjects of "compensation," "cooperation with other brokers," and "dispute resolution," respectively, and provided, in pertinent part as follows as follows: COMPENSATION: Seller will compensate Broker as specified below for procuring a buyer who is ready, willing, and able to purchase the Property or any interest in the Property on the terms of this Agreement or on any other terms acceptable to Seller. Seller will pay Broker as follows (plus applicable sales tax): 8% of the total purchase price or $15,000 maximum, no later than the date of closing specified in the sales contract. However closing is not a prerequisite for Broker's fee being earned. * * * (d) Broker's fee is due in the following circumstances: (1) If any interest in the Property is transferred . . . , regardless of whether the buyer is secured by Broker, Seller or any other person. * * * COOPERATION WITH OTHER BROKERS: Broker's office policy is to cooperate with all other brokers except when not in the Seller's best interest, and to offer compensation to: Buyer's agents, who represent the interest of the buyer and not the interest of Seller in a transaction, even if compensated by Seller or Broker Nonrepresentatives Transaction brokers. None of the above (if this box is checked, the Property cannot be placed in the MLS). * * * 10. DISPUTE RESOLUTION: This Agreement will be construed under Florida law. All controversies, claim and other matters in question between the parties arising out of or relating to this Agreement or the breach thereof will be settled by first attempting mediation under the rules of the American Arbitration Association or other mediator agreed upon by the parties. . . . Shortly after they left the employ of Allen and began working for Unlimited, Respondent and Mr. Sprauer showed Nicholas Damiano the Piazza Property. Mr. Damiano thereafter made a written offer to purchase the Piazza Property, which the Piazzas accepted, in writing, on July 4, 2001. The sales price was $165,000.00. Mr. Damiano put down a $10,000.00 deposit, which, in accordance with paragraph 2(a) of the contract between Mr. Damiano and the Piazzas (Sales Contract), was "held in escrow by [Unlimited]." The obligations of Unlimited, as escrow agent, were described in paragraph 6 of the Sales Contract, which provided as follows: ESCROW. Buyer and Seller authorize GMAC, Realty Unlimited Telephone: . . . Facsimile: . . . Address: . . . to receive funds and other items and, subject to clearance, disburse them in accordance with the terms of this Contract. Escrow Agent will deposit all funds received in a non- interest bearing account. If Escrow Agent receives conflicting demands or has a good faith doubt as to Escrow Agent's duties or liabilities under this Contract, he/she may hold the subject matter of the escrow until the parties mutually agree to its disbursement or until issuance of a court order or decision of arbitrator determining the parties' rights regarding the escrow or deposit the subject matter of the escrow with the clerk of the circuit court having jurisdiction over the dispute. Upon notifying the parties of such action, Escrow Agent will be released from all liability except for the duty to account for items previously delivered out of escrow. If a licensed real estate broker, Escrow Agent will comply with applicable provisions of Chapter 475, Florida Statutes. In any suit or arbitration in which Escrow Agent is made a party because of acting as agent hereunder or interpleads the subject matter of the escrow, Escrow Agent will recover reasonable attorneys' fees and costs at all levels, with such fees and costs to be paid from the escrowed funds or equivalent and charged and awarded as court or other costs in favor of the prevailing party. The parties agree that Escrow Agent will not be liable to any person for misdelivery to Buyer or Seller of escrowed items, unless the misdelivery is due to Escrow Agent's willful breach of this Contract or gross negligence. Paragraph 12 of the Sales Contract addressed the subject of "brokers" and provided as follows: BROKERS. Neither Buyer nor Seller has utilized the services of, or for any other reason owes compensation to, a licensed real estate broker other than: Listing Broker: Allen Real Estate, Inc. who is a transaction broker and who will be compensated by x Seller _ Buyer _ both parties pursuant to x a listing agreement _ other (specify) Cooperating Broker: GMAC Realty Unlimited who is a transaction broker who will compensated by _ Buyer x Seller _ both parties pursuant to _ an MLS or other offer of compensation to a cooperating broker _ other (specify) (collectively referred to as "Broker") in connection with any act relating to the Property, included but not limited to, inquiries, introductions, consultations and negotiations resulting in this transaction. Seller and Buyer agree to indemnify and hold Broker harmless from and against losses, damages, costs and expenses of any kind, including reasonable attorneys' fees at all levels, and from liability to any person, arising from (1) compensation claimed which is inconsistent with the representation in this Paragraph, (2) enforcement action to collect a brokerage fee pursuant to Paragraph 10, (3) any duty accepted by Broker at the request of Buyer or Seller, which duty is beyond the scope of services regulated by Chapter 475, F.S., as amended, or (4) recommendations of or services provided and expenses incurred by any third party whom Broker refers, recommends or retains for or on behalf of Buyer or Seller. The Damiano/Piazza transaction was originally scheduled to close on July 25, 2001. At the request of the Piazzas, the closing was rescheduled for August 7, 2001. A few days before August 7, 2001, Mr. Sprauer asked Respondent "where the closing was going to take place" and "what title company" would be handling the matter. Respondent replied that the closing was "going to be delayed again because Mr. Damiano . . . was going to have to have some type of cancer surgery." It turned out that the closing was not "delayed again." It took place on August 7, 2001. At the closing were Mr. Damiano, the Piazzas, Respondent, and the closing agent from the title company, First American Title Insurance Company (First American).3 Neither Mr. Schevers, nor Mr. Sprauer, was in attendance. Mr. Sprauer did not even know that the closing was taking place. He was under the impression, based on what Respondent had told him, that the closing had been postponed. Had he not been misinformed, he would have attended the closing. Respondent did not contact Mr. Sprauer following the closing to let him know that, in fact, the closing had occurred. Mr. Schevers, on the other hand, was made aware that closing would be held on August 7, 2001. He was unable to attend because he had "prior commitments." It was Respondent who informed Mr. Schevers of the August 7, 2001, closing date. The morning of August 7, 2001, Respondent went to Unlimited's Stuart office and asked Mr. Schevers for the $10,000.00 Unlimited was holding in escrow in connection with the Damiano/Piazza transaction, explaining that he needed it for the closing that was going to be held later that day. Before complying with Respondent's request, Mr. Schevers contacted First American and asked that he be faxed a copy of the United States Department of Housing and Urban Development Settlement Statement (HUD Statement) that First American had prepared for the closing. As requested, First American faxed a copy of the HUD Statement to Mr. Schevers. Upon reviewing the document, Mr. Schevers "immediately noticed that [it indicated that] the entire commission [of $7,000.00] was going to Allen." Mr. Schevers "then proceeded to call First American" and asked why Unlimited was not "reflected on this settlement statement." Mr. Schevers was told that a First American representative "would get right on it and get back to [him]." Mr. Schevers did not wait to hear back from First American before handing an "escrow check" in the amount of $10,000.00 to Respondent. He instructed Respondent, however, to "not give anybody this check unless that statement [the HUD Statement] [was] changed and reflect[ed] [Unlimited's]" share of the commission earned from the sale of the Piazza Property. He further directed Respondent to telephone him if this change was not made. Respondent did not follow the instructions Mr. Schevers had given him. He delivered the $10,000.00 "escrow check" to the closing agent at the closing, even though the HUD Statement had not been changed to reflect Unlimited's sharing of the commission. At no time during the closing did Mr. Schevers receive a telephone call from Respondent. According to the HUD Statement that Mr. Damiano, the Piazzas, and the closing agent signed at the closing, Allen received a commission of $7,000.00 "from seller's funds at settlement." The document makes no mention of any other commission having been paid as part of the closing. On or about August 9, 2001, Respondent received a "commission check" from Allen. The check was made payable to Respondent and was in the amount of $3,000.00. Under the "DOLLARS" line on the check, the following was typed: 4200 Total Comm[4] 1200 ADVANCE[5] Typed next to "MEMO" on the bottom left hand corner of the check was "DAMIANO-PIAZZA 165,000 S&L." It has not been shown that the "commission check" Respondent received from Allen was for anything other than the commission Allen owed Respondent for services performed when Respondent was still employed by Allen. Mr. Schevers' consent to Respondent's receiving this $3,000.00 "commission check" was neither sought nor given. Less than a week after the closing, having spotted Mr. Damiano mowing grass on a vacant lot that Mr. Damiano owned, Mr. Sprauer walked up to him and asked "how his surgery [had gone]." Mr. Damiano "acted very surprised [like] he didn't know what [Mr. Sprauer] was talking about." Mr. Damiano's reaction to his inquiry led Mr. Sprauer to believe "that the closing had probably taken place." He "immediately contacted [Mr. Schevers] and asked him to check into it." Mr. Schevers subsequently learned from First American that Allen "had gotten all of the [commission] check" at the closing. Mr. Schevers then telephoned Respondent. This was the first communication he had had with Respondent since before the closing. Respondent told Mr. Schevers that "he got the check" and "he would be right over with it." Respondent, however, did not keep his promise. After his telephone conversation with Respondent, Mr. Schevers discovered that Allen "had cut [Respondent] a check and [Respondent] had gone immediately and deposited it." This discovery prompted Mr. Schevers to place another telephone call to Respondent. This telephone conversation ended with Mr. Schevers telling Respondent "he was terminated." Mr. Schevers thereafter notified Petitioner in writing that Respondent was no longer associated with Unlimited. He also filed with Petitioner a complaint against Respondent alleging that Respondent had "acted inappropriately" in connection with the Damiano/Piazza transaction. Mr. Schevers had expected Unlimited to receive, for the role it played in the Damiano/Piazza transaction, "50 percent of the total commission," or $3,500.00, in accordance with the provisions of the "multiple listing service for St. Lucie County."6 He holds Respondent responsible, at least in part, for Unlimited's not receiving these monies.7 At the time of the Damiano/Piazza transaction, Unlimited had contracts with its sales associates which provided that the associates would receive "70 percent of the net" of any commission Unlimited earned as a result of the associates' efforts. Had Unlimited received a commission as a result of the Damiano/Piazza transaction, it would have "split" it with Respondent and Mr. Sprauer as required by the contracts it had with them.8
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Commission issue a final order dismissing the Administrative Complaint issued against Respondent in the instant case in its entirety. DONE AND ENTERED this 7th day of July, 2004, in Tallahassee, Leon County, Florida. STUART M. LERNER 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 7th day of July, 2004.
Findings Of Fact At all times relevant, Bangert was a licensed real estate salesman with State of Florida license number 0312002. On or about May 1, 1986, Cynthia Green (now Cynthia Tyson) listed her house at 408 Lakeview Drive, Altamonte Springs, Florida, under an exclusive right of sale contract with J. Scott Jones, a licensed real estate broker. Through his broker, Help U. Sell (Thomas Jafek and Thomas Jafek II), Bangert offered $64,900.00 to Ms. Tyson for the Lakeview house. The contract for sale offered a $1,000.00 deposit note, with two mortgages, including a balloon mortgage, payment of $3,000.00 fix-up costs by the seller, and cash to the seller at closing in the amount of $15,659.00 The offer was rejected by Ms. Tyson. J. Scott Jones negotiated over the telephone with Thomas Jafek II, and then with Bangert. The basic requirement of Ms. Tyson was that she wanted $50,000.00 net at closing. She also wanted a cash deposit, as she had a previous negative experience with a deposit note. J. Scott Jones does not recall that he told Bangert that a cash deposit was required, but he knows the issue came up sometime during the telephone discussion. He did not speak to both Jafek and Bangert at the same time. A second contract offer was signed by Bangert and was accepted by Ms. Tyson on August 30, 1986. The purchase price and method of payment was set out as follows: PURCHASE PRICE $ 68,500.00 PAYMENT: Deposit(s) to be held in escrow by Help-U-Sell of College Park, upon acceptance in the amount of $ 1,000.00 Subject to AND [sic] assumption of Mortgage in good standing in favor of To Be Obtained having an approximate present principal balance of $ 40,000.00 Purchase money mortgage and note bearing interest at 9 percent on terms set forth herein below, in the principal amount of 360 payments of 189.10 to Balloon at 60th mo. $ 23,500.00 Other Purchase Money Mortgage @ 10 percent in a single payment at 60th mo. $ 5,000.00 Balance to close (U.S. cash, LOCALLY DRAWN certified or cashier's check), subject to adjustments and prorations $ 68,500.00 (Petitioner's Exhibit #4) The Contract also provided for the $50,000.00 net at closing to the seller. Bangert gave Thomas Jafek a deposit note in the amount of $1,000.00. Jafek did not know how to put a note in a trust or escrow account, so he held it in his files at Help U. Sell. Jafek had dealt with Bangert before in real estate transactions and had acted before as the escrow agent. In those dealings Bangert only put down notes, never cash. Jafek understood that Bangert's role was as a principal buyer and that Bangert intended to assign the contract for sale. The transaction was initially scheduled to close on September 26, 1987. On September 30, 1986, the parties agreed to extend the closing until October 10, 1986. When J. Scott Jones met with Bangert to get the extension signed, he learned that a note, rather than cash deposit had been made. The transaction never closed. For reasons that are not material to this proceeding, Bangert did not appear at the closing. Cynthia Tyson retained an attorney, Garrick N. Fox, who sent letters to Jafek and to Bangert on October 17, 1986. The letter to Jafek provides, in pertinent part: As per the contract for sale and purchase, your company holds one thousand dollars in escrow and we may [sic) hereby make demand that you remit to this law office the one thousand dollars held in escrow as partial damages for the default of the contract. (Petitioner's Exhibit #6) The letter to Bangert does not mention the deposit, but states that the contract is in default. The final paragraph states: It is my sincere desire that we can settle this matter amicably without the necessity of litigation. If you can close on this contract forthwith, all of these problems can be settled. If not I would appreciate it if you would have your attorney contact [sic] so that we can immediately take the proper steps to minimize Miss Green's damages. (Petitioner's Exhibit #7) The attorney never made an oral demand on Bangert for the $1000.00. Jafek did not consider his letter to be a present demand, but rather a statement of intent to make a demand in the future. Jafek did not tender the note and the $1000.00 was not paid. Bangert had no intent to make a cash deposit. He claims that he told "Tom Jr." " (Thomas Jafek II) to type "a deposit note" on the second contract offer, but that even without that language, a note, rather than cash, was not precluded by the contract terms. Bangert intended that the transaction take place and did not have an intent or motive to defraud the seller. If the transaction had closed, he claims he would have honored the note. As far as he knows, Jafek still has the note. Bangert claims also that it was an oversight that he did not reveal his real estate license status on the contract. The Jafeks knew he was a real estate salesman. Further, he and Scott Jones were teaching at the same real estate school and he felt that Jones should have known his status. He did not intend to hide the fact of his license from anyone. His business in the last three years has been actively serving as a principal buyer and seller for other parties. Bangert's liability on his note is not at issue. In the absence of clear evidence of his knowledge of the seller's conditions, I cannot find that he is guilty of fraud in putting a note cash on deposit. Nor did he deliberately misrepresent a material fact to the seller by failing to disclose that he was a licensed real estate salesman. Ms. Tyson never met Bangert. Both parties were dealing at arms length through their own brokers. Conclusions of Law The Division of Administrative Hearings has jurisdiction over this matter pursuant to Section 120.57(1) F.S. and Section 455.225(4) F.S. Section 475.25(1) F.S. provides that the Florida Real Estate Commission may impose discipline if it finds that a licensee, (b) Has been guilty of fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme or device, culpable negligence, or breach of trust in any business transaction... DPR has the burden of proving the allegations of this complaint through evidence that is clear and convincing. Ferris v. Turlington, 510 So.2nd 292 (Fla. 1987). It is apparent now that Ms. Tyson wanted a cash deposit as one condition of accepting an offer to buy her property. It is not clear that the condition was communicated to Bangert by either his broker, Thomas Jafek, II, or by Ms. Tyson's broker, J. Scott Jones. Without this material evidence it cannot be established that Bangert deliberately engaged in a subterfuge. Without evidence of dishonest or illicit intent, there is no guilt under Section 475.25(1)(b), F.S. Morris v. Department of Professional Regulation 474 So.2nd 841 (Fla. 5th DCA 1985). No rule nor provision of law has been cited to require a real estate licensee to reveal his status as such when engaging in the purchase and sale of property in his personal capacity. Nor was evidence produced that would establish and justify such a policy by the Board. In Santaniello v. Department of Professional Regulation 432 So.2nd 84 (Fla. 2nd DCA 1983), the court upheld the Board's right to determine that a broker violated Section 475.25(1)(b) F.S. when he failed to reveal that a purchaser was his mother-in- law. In that case, the court observed that the broker owed his allegiance to the sellers and was obligated to inform them of anything which might influence their decision to sell. Because of that, the existence of the mother-in-law relationship was deemed a material fact. No such foundation for a duty to inform was established here, therefore there was no violation of section 475.25(1)(b) F.S.
Recommendation Based on the foregoing, it is hereby, RECOMMENDED: That the Administrative Complaint against Larry G. Bangert be dismissed. DONE and RECOMMENDED this 17th day of December, 1987 in Tallahassee, Florida. MARY CLARK Hearing Office 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 17th day of December, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-3044 The following constitute specific rulings on the findings of fact proposed by Petitioner. Adopted in paragraph #1. Adopted in paragraph #2. Adopted in substance in paragraphs #3 and #4. Adopted in substance in paragraph #4. Evidence did not establish that Bangert was aware of the cash deposit condition by Ms. Tyson. Rejected as contrary to the evidence. The face of the contract does not require cash. Adopted in paragraph #7. Adopted in paragraph #8. Adopted in paragraph #6. Adopted in substance in paragraph #7. Adopted in paragraph #11. Adopted in paragraph #7. Adopted in part in paragraph #10. Bangert contended that the contract did not specify cash. Rejected as cumulative. Adopted in paragraph #9. Rejected as immaterial. COPIES FURNISHED: Copies furnished: DOAH Case No. 87-3044 James R. Mitchell, Esquire Department of Professional Regulation Legal Division of Real Estate 400 West Robinson Street Tallahassee, Florida 32802 Larry G. Bangert 103 Cashew Court Longwood, Florida 32750 Harold Huff, Executive Director Florida Real Estate Commission 400 West Robinson Street Post Office. Box 1900 Orlando, Florida 32802 William O'Neil, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 =================================================================
Findings Of Fact In March of 1976, Bruce Hill contacted the petitioner and told him he wanted to sell three Dronerties, including the "Village Squire," a restaurant in Murfreesboro, North Carolina, which was encumbered by a mortgage. William P. Firth expressed an interest in purchasing the restaurant and, after Mrs. Fifth had seen the property, the Firths made an offer. Mr. Firth told petitioner, on April 2, 1976, at the time of the offer, "that he did not have the $10,000.00 to make the down payment that day." Petitioner's exhibit No. 4. He asked to borrow this sum from petitioner, promising to repay it in a few days. Petitioner "was willing to do what [he] could to consummate a sale [because of the seller's financial plight . . . and] knew that [he] controlled the don payment until closing [so he] agreed to loan Mr. Firth the funds for a few days." Petitioner's exhibit No. 4. A day or two before the sale was consummated, Mr. Firth told petitioner that a friend who had pledged a $30,000 loan had decided to buy a farm, instead of lending money to Mr. Firth. Mr. Firth advised petitioner that he did not have money with which to repay the down payment petitioner had advanced. Petitioner then telephoned Bruce Hill. Even though he got no answer, he went to Mr. Hill's house and knocked on the door, because he knew Mr. Hill was trying to avoid creditors. When nobody came to the door, petitioner left and contacted L. Frank Burleson, Jr., Mr. Hill's lawyer. After petitioner explained the situation, Mr. Burleson suggested that petitioner take a third mortgage on the restaurant as security for repayment of the $10,000.00, with Mr. Hill taking back a second mortgage as security for $20,000.00 of the purchase money. Later, Mr. Burleson told petitioner that Mr. Hill had no objection to this arrangement. Two days before the Hill-Firth transaction closed, petitioner lent Mr. Hill $900.00, for an unrelated purpose. Petitioner discussed the Hill-Firth transaction with Mr. Hill and told him about the planned third mortgage. Mr. Hill indicated he was aware of the arrangements. On the day the, transaction was consummated, Messrs. Hill and Burleson went to the courthouse to check whether" the restaurant property had been encumbered by liens of creditors other than Mr. Hill's mortgagee. Finding none, Mr. Hill executed a deed and filed the mortgages executed by Mr. Firth, including the mortgage in favor of petitioner. Mr. Burleson had earlier prepared this mortgage in favor of petitioner, for Mr. Firth's signature. Petitioner testified that he never told Mr. Hill that the Firths deposited $10,000.00 with petitioner. It was clear from the evidence, however, that petitioner made the loan to the Firths and advised Mr. Hill of the Firths' offer some days before petitioner disclosed to Mr. Burleson the loan he had made to the Firths. Although petitioner's usual practice was to "get a down payment equal to this] commission" (R37), he actually disbursed $10,000.00 to Mr. Burleson's law firm in connection with the Firth-Hill transaction. He covered this disbursal with a $6,000.00 check drawn on his escrow account and a $4,000.00 check drawn on another account. Petitioner testified that the $6,000.00 represented earned commissions lying idle in the escrow account. Mr. Firth did not participate in the North Carolina proceedings that, on May 13, 1977, eventuated in revocation of his real estate broker's license there, except to send a letter setting forth his position. Petitioner's exhibit No. 4. He was not well at the time and was contemplating moving to Florida. On April 15, 1977, petitioner was found guilty of violating North Carolina law, specifically of: . . . violating G. S. 93A-6(a)(4) in that he acted for the buyer by lending the buyer $10,000.00 without the knowledge of his principal, the seller. . . . violating G. S. 93A-6(a)(1) in that on April 2, 1976 he represented to the seller that the buyer had deposited $10,000.00 with him as earnest money down payment when, in fact, the buyer had not deposited $10,000.00. . . . violating G. S. 93A-6(a)(8) and (10) in that he made a $10,000.00 loan to the buyer for the earnest money down payment and did so by temporarily using $6,000.00 in funds from his escrow account. Respondent's exhibit No. 2. Petitioner had never before been the object of disciplinary proceedings as a real estate salesman or broker. Petitioner has never been arrested for or convicted of any crime. He has never gone bankrupt and had no judgments outstanding against him at the time of the hearing. At the time of the hearing, petitioner served as a deacon of the First Baptist Church of Venice.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That respondent deny petitioner's application for registration as a real estate salesman. DONE and ENTERED this 24th day of October, 1979, in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings Room 101 Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Robert Jackson McGill, Esquire Suite A, 245 N. Tamiami Trail Venice, Florida 33595 Kenneth M. Meer, Esquire Post Office Box 1900 Orlando, Florida 32802
