The Issue The issue in this case is whether Respondent Clark's Country Farmers Market, Inc. owes Petitioner a sum of money for shipments of citrus fruit.
Findings Of Fact The evidence presented at final hearing established the facts that follow. The Parties and Their Problem Spyke's Grove and Clark's are "citrus fruit dealers" operating within the Department's regulatory jurisdiction. As a wholesale shipper, Spyke's Grove packages and arranges for delivery of citrus products pursuant to purchase orders that retail sellers such as Clark's submit. The packages typically are labeled with the retail seller's name, and thus the retail buyer (and the recipient, if the citrus is purchased as a gift) usually will not be aware of Spyke's Grove's involvement. The instant case involves a series of orders that Clark's placed with Spyke's Grove between October and December 1999 for packages of gift fruit. Under a number of informal, largely unwritten contracts, Spyke's Grove agreed, each time it received an order from Clark's, to ship a gift fruit box or basket to the donee designated by Clark's' retail customer, for which fruit shipment Clark's agreed to pay Spyke's Grove. Spyke's Grove alleges that Clark's failed to pay in full for all of the gift fruit packages that Clark's ordered and Spyke's Grove duly shipped. Clark's contends (though not precisely in these terms) that Spyke's Grove materially breached the contracts, thereby discharging Clark's from further performance thereunder. The Transactions From mid-October 1999 until around December 12, 1999, Clark's faxed or e-mailed to Spyke's Grove approximately 350 individual orders for gift fruit packages. Among other information, each order consisted of a shipping label that identified the product (e.g. the type of gift box or basket), the intended recipient, and the destination. Spyke's Grove manifested its intent to fill these orders by faxing statements of acknowledgment to Clark's, by telephoning Clark's, or both. Although the many contracts that arose from these transactions were thus documented, the writings left much unsaid. For example, the parties did not explicitly agree in writing that Spyke's Grove would deliver the subject gift baskets to the donees before Christmas, nor did they make any express oral agreements to this effect.1 Further, the parties did not specifically agree that Spyke's Grove would be obligated to deliver the gift fruit into the hands of the donees and bear the risk of loss until such tender of delivery. Rather, the contracts between Spyke's Grove and Clark's were ordinary shipment contracts that required Spyke's Grove to put the goods into the possession of carriers (such as the U.S. Postal Service or United Parcel Service) who in due course would deliver the packages to the donees. For many weeks, until early December 1999, Clark's placed orders, and Spyke's Grove filled them, under the arrangement just described. The relationship was not completely trouble-free, for the parties had some problems with duplicate orders. Most, if not all, of these difficulties stemmed from the implementation of a computerized ordering system which allowed Clark's to "export" orders directly to Spyke's Grove's electronic database. The parties recognized at the time that errors were occurring, and they attempted contemporaneously to identify and purge unintended duplicates. Pursuant to the course of dealing between these parties, Spyke's Grove filled orders that were not affirmatively identified as errors prior to the scheduled shipment date. The Fire On the night of Sunday, December 12, 1999, a devastating fire at Spyke's Grove's premises caused substantial damage, temporarily disrupting its citrus packing and shipping operations at the peak of the holiday season. Working through and around the loss, Spyke's Grove soon recovered sufficiently to reopen for business. By around noon on Tuesday, December 14, 1999, its telephone service had been restored, and activities relating to shipping resumed on Friday, December 17, 1999. The Aftermath Meantime, Clark's contends, customers had begun calling Clark's on December 10, 1999, to complain that gift fruit packages were not being received as promised. None of the customers testified at hearing, however, and therefore no competent, non-hearsay evidence establishes the contents of their alleged out-of-court statements. On December 14, 1999, following several unsuccessful attempts to communicate with Spyke's Grove shortly after the fire (about which Clark's remained unaware), Denise Clark, acting on behalf of Clark's, reached Robert Spiece, a representative of Spyke's Grove, on his cell phone. At hearing, Ms. Clark and Mr. Spiece gave conflicting accounts as to the substance of their December 14, 1999, telephone conversation. Neither disputed, however, that during this conversation Ms. Clark and Mr. Spiece agreed, at Ms. Clark's request, that all orders of Clark's not yet shipped by Spyke's Grove would be canceled, effective immediately, as a result of the fire. Although Ms. Clark claimed that Mr. Spiece further informed her that Spyke's Grove could not identify which orders had been shipped, the factfinder does not believe that Mr. Spiece made such a sweeping negative statement. Rather, as Mr. Spiece explained at hearing, Ms. Clark probably was told that information regarding the filled orders would not be available that day. Without waiting for further information from Spyke's Grove, Clark's began calling its retail customers to ascertain whether they had received packages that were supposed to have been shipped by Spyke's Grove. Employees of Clark's who had participated in this process——which took four to five days—— testified at hearing about conversations between themselves and various customers. As uncorroborated hearsay, however, the out- of-court statements attributed to these customers were not competent substantial evidence upon which a relevant finding of fact, e.g. that any particular customer or customers had not received their gift fruit, could be based. Moreover, this hearsay evidence, even if competent, would still have been too anecdotal to establish persuasively any widespread failure on the part of the carriers to deliver the packages shipped by Spyke's Grove. On December 15, 1999, Spyke's Grove prepared three draft invoices for the gift fruit packages that Clark's had ordered and which Spyke's Grove had shipped before December 12, 1999. Numbered 1999113001, 1999121101, and 1999121201, the invoices sought payment of $688.72, $2,415.48, and $298.66, respectively. On the first page of Invoice #1999121201, Barbara Spiece, the President of Spyke's Grove, wrote: Some of these were lost in the fire. "A" day left in the morning. "Springfield" was on the floor to go out that night. I realize there are many duplicates in these shipped reports. We tried to watch for them but with different order numbers it was very difficult. Just cross them out [and] you will not be charged for them. I apologize for all of the problems we have had this season [illegible] wish you luck. These bills were faxed to, and received by, Clark's on December 16, 1999. Clark's did not pay the invoices, or dispute them, or cross out the unintended duplicate orders (as it had been invited to do) to effect a reduction in the outstanding balance. Instead, Clark's ignored Spyke's Grove's requests for payment. Not only that, in disregard of its existing contractual obligations and with no advance notice to Spyke's Grove, Clark's proceeded on its own to fill all of the orders that it had placed with Spyke's Grove before December 12, 1999——including those orders that Spyke's Grove, through its draft invoices, claimed to have shipped. Even after the fact, Clark's failed to inform Spyke's Grove that it had, in effect, repudiated its contractual promises to pay Spyke's Grove for the gift fruit packages already shipped as of December 12, 1999 (i.e. the orders not canceled on December 14, 1999). The Inevitable Dispute Having heard nothing from Clark's in response to its December 16, 1999, fax, Spyke's Grove sent its invoices out again, in final form, on January 25, 2000.2 This time, Ms. Spiece did not inscribe any instructions to cross out duplicates for a discount. Numbered 11063001 ($688.72), 11063002 ($2,449.14), and 11063003 ($195.52), these bills totaled $3,333.38. Each of these invoices contained the following boilerplate "terms": Net 14 days prompt payment is expected and appreciated. A 1 ½% monthly service charge (A.P.R. 18% per annum) may be charged on all past due accounts. Customer agrees to pay all costs of collection, including attorneys [sic] fees and court costs, should collection efforts ever become necessary. Clark's did not remit payment or otherwise respond to Spyke's Grove's statements. Accordingly, on June 20, 2000, Spyke's Grove sent a letter to the Department requesting assistance. Clark's was provided a copy of this letter. Shortly thereafter, Spyke's Grove filed a Complaint with the Department, initiating the instant proceeding. Ultimate Factual Determinations Clark's refusal to pay for the goods ordered from and shipped by Spyke's Grove constituted a breach of the contracts between the parties. Spyke's Grove did not materially breach the agreements. Further, Clark's did not object, within a reasonable period of time, to the statements of account that Spyke's Grove rendered preliminarily on December 16, 1999, and finally on January 25, 2000. Accordingly, these invoices amount to an account stated concerning the transactions between the parties. Clark's failed to overcome the presumption of correctness that attaches to an account stated, either by proving fraud, mistake, or error. Spyke's Grove has suffered an injury as a result of Clark's' breach. Spyke's Grove's damages consist of the principal amount of the debt together with pre-award interest at the statutory rate. Accordingly, Spyke's Grove is entitled to recover the following amounts from Clark's: Principal Due Date Statutory Interest $3,333.38 2/08/99 $ 298.66 (2/08/00 - 12/31/00) $ 335.56 (1/01/01 - 11/30/01) $3,333.38 $ 634.22 Interest will continue to accrue on the outstanding balance of $3,333.38 in the amount of $1.00 per day from December 1, 2001, until the date of the final order.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order awarding Spyke's Grove the sum of $3,333.38, together with pre- award interest in the amount of $634.22 (through November 30, 2001), plus additional interest from December 1, 2001, until the date of the final order, which will accrue in the amount of $1.00 per day. DONE AND ENTERED this 29th day of November, 2001, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM 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 29th day of November, 2001.
Findings Of Fact Petitioner Ann Storck Center, Inc., is a non-profit agency with a volunteer Board of Directors which began in 1956 when Ann Storck opened her first group home in Broward County to assist children with mental retardation. Petitioner serves children and young adults with developmental disabilities by providing preschool, developmental training, prevocational training, and residential services in several intermediate care facilities for the mentally retarded (ICF/MR). The individuals served by Petitioner at the Pembroke Pines cluster are within the severe to profound range of mental retardation and have significant secondary disabilities, such as cerebral palsy, autism, and epilepsy. There are medically fragile and developmentally disabled individuals at the Pembroke Pines cluster facility. Several of them are tube fed and have significant seizure problems or renal problems. Other than reimbursement under the Medicaid laws and other funds from government agencies, Petitioner obtains its funds from charitable endeavors such as the operation of a thrift shop six days per week, every week for the past seventeen years, together with numerous other fund raising efforts. Petitioner's budget for providing services to individuals with developmental disabilities is $300,000 to $400,000 in excess of the Medicaid and other government funding which is provided each year. In the fiscal year ending June 30, 1990, which is the subject of the cost report and desk audit involved in this proceeding, Petitioner had a deficit of almost $120,000 dollars at the Pembroke Pines cluster. Petitioner does not have cash reserves. If, in addition to that deficit, Petitioner is required to pay back money to the Department and have a reduced Medicaid reimbursement rate at the present time, Petitioner cannot survive the consequences. Although Petitioner is the provider of all ICF/MR services at the Pembroke Pines cluster facility, the Department holds the Medicaid provider number. Medicaid cost reports are filed by Petitioner every year, using the Department's provider number. In those cost reports, Petitioner includes cost figures provided to it by the Department for the Department's costs related to the Pembroke Pines cluster facility. The same certified public accountant has been filing the Medicaid cost reports for the Pembroke Pines facility on Petitioner's behalf since 1984. Although he performs the facility's monthly accountings and performs an annual audit, that C.P.A. is not in a position to verify the figures provided to Petitioner by the Department. Accordingly, each year's cost report contains a disclaimer letter from him, and the Department has never raised any concerns regarding that letter. Each year's cost report has been completed in accordance with the Department's directions to Petitioner. Specifically, Petitioner includes all costs of rendering ICF/MR services at the Pembroke Pines cluster. The Department then uses each June 30 cost report to obtain Medicaid funds from the federal government. Those funds have been paid to the Department and not to Petitioner since the Department considers itself to be the provider of ICF/MR services at the Pembroke Pines cluster. Prior to 1991, the Department did not reimburse Petitioner pursuant to the Medicaid cost reports filed by Petitioner representing the actual costs which Petitioner had expended in providing ICF/MR services. Rather, the Department established Petitioner's Medicaid per diem reimbursement rate pursuant to a fixed rate contract. By doing so, the Department reimbursed Petitioner for services rendered at a rate less than Petitioner's actual costs and less than the money the Department received from the federal government utilizing Petitioner's cost report. The Department retained those additional monies. Although audit reports were drafted by the Department as far back as 1987 and as far back as for the fiscal 1985 cost report for the Pembroke Pines cluster, the Department held back those audit reports until June of 1991 because the Department had not established procedures for conducting audits of the cluster facilities and had not trained staff to perform those audits until that time. The Department's policies on how to process desk audits, even when finalized in 1991, were never published as a rule, were not generally made available to persons other than the Department employees who attended the training meetings, and were not explained during the final hearing in this cause. In 1989, Petitioner, other providers of ICF/MR services, and a trade association representing ICF/MR providers filed a lawsuit against the Department and against two Department officials in the United States District Court for the Southern District of Florida, alleging that the manner in which the Department reimbursed providers of ICF/MR services did not comply with federal law. On June 17, 1991, the United States Magistrate Judge issued a report recommending that a preliminary injunction be entered against the Department. Based on that Report, oral argument, and an independent review of the file, the United States District Judge entered an Order Granting Preliminary Injunction on September 13, 1991. The 17-page Order Granting Preliminary Injunction was both mandatory and prohibitory. It was held that the Department's method of reimbursing operators of cluster facilities such as Petitioner pursuant to a fixed-rate contract rather than pursuant to a reimbursement plan for providers of ICF/MR services violated Title 42 U.S.C. Section 1396(a)(13), known as the Boren Amendment to the Medicaid Act. Pursuant to the Boren Amendment, the Department was required to have established reimbursement rates which are "reasonable and adequate to meet the costs which must be incurred by efficiently and economically operated facilities in order to provide care and services in conformity with applicable state and federal laws, regulations, and quality and safety standards." The federal court ordered the Department to cease reimbursing its cluster providers pursuant to a fixed-rate contract and ordered the Department to formulate a new reimbursement plan which complied with the substantive requirements of the Boren Amendment. The federal court ordered the Department to file its new plan by October 4, 1991, with the rates of reimbursement established under that plan to be retroactive to September 4, 1991. The court specifically held that the Department's argument that it was the provider of ICF/MR services because it held the provider number was ". . .false to the point of absurdity. . . ." The Department responded with an amended reimbursement plan for providers of ICF/MR services effective July 1, 1991. Medicaid is a prospective cost reimbursement system. The reimbursement rate is set prospectively based upon historic data. In Florida there are two rate semesters each year. Therefore, April 1, 1991, would be the first rate period affected by the Department's audit of the Pembroke Pines cluster cost report for the fiscal year ending June 30, 1990. The Department began its calculations relative to its audit of the Pembroke Pines cost report in approximately February of 1991. The calculations were not completed until June of 1992. The Department's June 12, 1992, letter memorializing the results of the Department's desk audit notified the Department and Petitioner as to the per diem reimbursement rate for the Prembroke Pines cluster facility effective with the April 1, 1991, rate semester; with a recalculation effective July 1, 1991, (the effective date of the new reimbursement plan ordered by the federal court); and with a recalculated rate effective September 1, 1991 (for some unexplained reason). When those rates were calculated and disclosed pursuant to the June 12, 1992, letter some nine months after the federal judge had rejected the Department's position that the Department was the provider of ICF/MR services because it held the provider number, the calculations were done and the reimbursement rate was established as though the Department was the provider of ICF/MR services at the Pembroke Pines cluster. In conjunction with the Department continuing to maintain that position in spite of the federal injunction against it, the audit letter explaining the audit adjustments and establishing the new reimbursement rates was sent by the Department's Tallahassee office to the Department's Fort Lauderdale office. When the Department's Residential Services Director for District 10 received the audit letter, he contacted the Tallahassee office of the Department. He requested, as he had done on a number of occasions previously, that Petitioner be reimbursed for excess costs above what the Department was allowing or that Petitioner receive an interim rate increase. That renewed request was denied by the Tallahassee office. The Residential Services Director was aware that Petitioner had been losing money operating the Pembroke Pines facility, that Petitioner was not being reimbursed for expenditures above the amount paid under the old fixed-rate contract system, and that Petitioner supplemented its reimbursement from the Department through fund raising activities by necessity. Since he, as part of his duties, attended admission and discharge meetings, attended licensure surveys, and had been involved with physical plant repairs and maintenance to the Pembroke Pines facility since 1987, he was familiar with the excellent survey reports which Petitioner receives regarding its operation of the facility, was familiar with Petitioner's excellent quality of care, and with Petitioner's efficient manner of providing services. The desk audit contained one positive adjustment. It increased Petitioner's operating expenses by $29,841. The reason for that positive adjustment was that the Department had provided to Petitioner an incorrect figure for the Department's costs related to the facility during the fiscal year ending June 30, 1990. That positive adjustment is a correct figure and increases the total allowable operating expenses for the Pembroke Pines cluster facility for the fiscal year to $1,619,888. Each cost item within the total allowable operating expenses of $1,619,888 is a reasonable, necessary, and ordinary cost incurred and expended for the operation of the Pembroke Pines cluster facility in an efficient and economical manner. The audit letter contained 9 negative adjustments for a total negative adjustment of $50,979. Each of those 9 negative adjustments is incorrect and is without basis. Each negative adjustment simply reduces the total cost in that particular category by an arbitrary percentage, and none of those negative adjustments is in accordance with the reimbursement plan governing providers of ICF/MR services. The erroneous negative adjustments made during the desk audit of the June 30, 1990, cost report resulted in a Medicaid reimbursement per diem rate of $184.91 for the rate period effective April 1, 1991, for level 8 and level 9 patients, which are the most severely disabled patients and are the only types of patients who receive ICF/MR services at the Pembroke Pines cluster facility. That per diem rate is incorrect. The correct Medicaid reimbursement per diem rate based upon proper auditing procedures and based upon the reimbursement rate plan is $191.36. Those proper auditing procedures include, for example, using the reimbursement plan in effect at the time the rates are to be calculated, something not done by the Department which used the reimbursement plan effective July 1, 1991, to compute the rates effective April 1, 1991. The errors made in the desk audit of the June 30, 1990, cost report are still causing Petitioner to be underpaid for its ICF/MR services. The June 30, 1990, cost report determines the base rate, for example, for the October 1, 1992, rate semester, during which semester the final hearing in this cause was conducted. The Department has been reimbursing Petitioner during the October 1, 1992, rate semester using a per diem rate of $212.05 rather than the correct figure of $216.12 per day per patient. The erroneous negative adjustments made during the desk audit were caused by the Department's use of the fixed-price contract rather than the ICF/MR rate plan to establish Petitioner's reimbursement rate. The desk audit report itself refers to the 9 negative adjustments as being contract adjustments. Further, the person who performed the audit testified at the final hearing that although all of the expenses would have been allowed under the published rate plan, without the negative adjustments, the audit was performed pursuant to instructions given to her by other Department employees to make adjustments pursuant to the fixed-rate contract because the per diem rate was to be established based on the Department's total costs as a District.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered: Finding the positive audit adjustment to have been properly made; Finding the negative audit adjustments to have been improperly made; Determining the total allowable operating expenses for the Pembroke Pines cluster facility for the fiscal year ending June 30, 1990, to be $1,619,888; Establishing the reimbursement rate for the facility's level 8 and level 9 care for the April 1, 1991, rate semester to be $191.36 per patient per day; Establishing the reimbursement rate for the facility's level 8 and level 9 care for the October 1, 1992, rate semester to be $216.12; and Recalculating the reimbursement rate for the other rate semesters subsequent to April 1, 1991, in accordance with this Recommended Order. DONE and ENTERED this 16th day of April, 1993, 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 16th day of April, 1993. APPENDIX TO RECOMMENDED ORDER Petitioner's proposed findings of fact numbered A, C, D, F-O, Q, R, T- W, Y-AH, AK, AN, AQ, AR, AT-AW, AZ, BC-BE, BG-BI, BM, BP-BS, BU-BX, BZ, CA, CC- CF, CH-CJ, CM-CO, CQ, and CS-DA have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed findings of fact numbered B, E, P, S, X, AM, AO, AS, AX, BF, BJ, BL, BO, BY, CG, CK, CL, CR, and DC-DE have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. Petitioner's proposed findings of fact numbered AY, BA, BB, and CP have been rejected as not being supported by the weight of the competent evidence in this cause. Petitioner's proposed findings of fact numbered AI, AJ, BN, BT, and DB have been rejected as being irrelevant to the issues under consideration in this cause. Petitioner's proposed findings of fact numbered AL, AP, BK, and CB have been rejected as being subordinate to the issues herein. Respondent's proposed findings of fact numbered 1, 10, and 13 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed findings of fact numbered 2, 9, and 11 have been rejected as not being supported by the weight of the competent evidence in this cause. Respondent's proposed findings of fact numbered 3-5, 12, 14-20, 24, and have been rejected as being subordinate to the issues herein. Respondent's proposed finding of fact numbered 6 has been rejected as being irrelevant to the issues under consideration in this cause. Respondent's proposed findings of fact numbered 7, 8, and 21-23 have been rejected as not constituting findings of fact but rather as constituting argument of counsel, conclusions of law, or recitation of the testimony. COPIES FURNISHED: Steven M. Weinger, Esquire Kurzban, Kurzban & Weinger, P.A. Second Floor 2650 Southwest 27th Avenue Miami, Florida 33133 Karel Baarslag, Esquire HRS Medicaid Office Building Six, Room 234 1317 Winewood Boulevard Tallahassee, Florida 32399-0700 Robert L. Powell, Agency Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
Findings Of Fact Petitioner, Deerfield Groves Company (Deerfield), is a licensed citrus fruit dealer under Chapter 601, Florida Statutes, and Chapter 20-34, Florida Administrative Code. As a licensee, Deerfield is subject to administrative and criminal prosecution for violation of the statutes and rules governing licensed citrus fruit dealers and was under administrative prosecution for alleged violations of Section 601.33, Florida Statutes, and Rule 20-34.11, Florida Administrative Code, at the time of the final hearing. Deerfield has legal standing as a party petitioner in this case. Respondent, Department Of Citrus (DOC), promulgated Rule 20-34.11, Florida Administrative Code, under the authority of Section 601.10, Florida Statutes. Rule 20-34.11 is designed to implement Section 601.33, Florida Statutes. Respondent, Department Of Agriculture And Consumer Services, (DACS), is the agency charged with the duty to enforce Section 601.33, Florida Statutes, and Rule 20- 34.11, Florida Administrative Code. Personnel of DACS' Division Of Fruit And Vegetable Inspection also are responsible for testing fresh citrus for maturity under Chapter 20-34, Florida Administrative Code. Licensees such as Deerfield furnish a testing room for DACS inspectors to perform maturity tests and certify fresh citrus, as required for marketing fresh fruit. DACS leases an extractor, used for squeezing juice from fruit samples, and subleases the extractor to the licensee. Under the sublease, the extractor is kept in the testing room for use by DACS inspectors and, when not being used by DACS inspectors, for use by the licensee in performing its own tests. Typically, the licensee furnishes the testing room with a table for two and a chair or two. When DACS inspectors perform maturity tests at the beginning of the early harvest, they bring most of the things they need for testing. The licensee provides the bins in which the fruit samples are carried into the testing room. The inspectors bring either a DACS slicing knife or their own. The licensee provides buckets it owns for use by the inspector during the test to collect juice extracted from fruit samples. The DACS inspectors also bring: a sizer to measure the fruit samples; a 2000 c.c. graduated cylinder to measure juice quantities; a 500 c.c. graduated cylinder to hold juice being tested for solids content and for temperature; aluminum pans to hold the graduated cylinders; a combination hydrometer for measuring juice solids content and temperature; a 25 m.1. pipet for transferring a measured amount of juice into a flask; the flask; a bottle of phenothaline with eyedropper top used for adding measured amounts of phenothaline to the flask of measured juice; a bottle of alkaline solution; and a burette for adding a measured amount of the alkaline solution to the flask of measured juice. During the harvest season, DACS leaves its equipment, instruments and solutions referred to in the preceding paragraph in the testing room. They are kept separate from the licensee's property and are not supposed to be used by the licensee. However, DACS allows the licensee to use its own bins and buckets and the extractor to conduct its own tests in the testing room when DACS inspectors are not using it. 1/ Some DACS inspectors request or allow licensees to assist during testing or to handle the fruit samples. 2/ Some allow licensees to attempt to influence the inspector's judgment by questioning the validity of the test or the accuracy of the inspector's observations or by comparing the inspector's results with the results of its own tests. Sometimes, this results in correction of an error the inspector otherwise would have made. It was not proved, however that there is an agency policy of requesting or allowing licensees to conduct themselves in those ways during testing. DACS has a policy to allow only one licensee representative in the testing room with the DACS inspector during testing. Violation of this policy is viewed as a violation of Section 601.33, Florida Statutes (1983). However, not all DACS inspectors strictly enforce this policy. Some allow more than one licensee representative in the testing room.
The Issue Has Respondent Kelly Marinaro, d/b/a Sunny Fresh Citrus Export and Sales Company (Sunny) paid Petitioner Frances A. Oakes and Daniel Holder, d/b/a Oakes Produce Company (Oakes) in full for watermelons (melons) purchased from Oakes during the 1996 melon season which are represented by Sunny/Oakes purchase order numbers 93981/4051, 93905/4063, 93921/4064, 94006/4066, and 93941/4096?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: At all times pertinent to this proceeding, Oakes was in the business of growing and selling "agricultural products" as that term is defined in Section 604.15(3), Florida Statutes, and was a "producer" as that term is defined in Section 604.15(5), Florida Statutes. Melons come within the definition of "agricultural products" as defined in Section 604.15(3), Florida Statutes. At all times pertinent to this proceeding, Sunny was licensed as a "dealer in agriculture products" as that term is defined in Section 604.15(1), Florida Statutes. Sunny was issued license number 831 by the Department, which is supported by bond number BND-262218 in the amount of $29,000, written by American, as surety, with an inception date of May 1, 1996, and an expiration date of April 30, 1997. The complaint was timely filed by Oakes in accordance with Section 604.21(1), Florida Statutes. Sometime before June 27, 1996, the parties entered into an oral agreement wherein Oakes would harvest and load melons onto trucks furnished by Sunny at locations specified by Oakes. The agreement provided that: (a) Oakes would guarantee the quality of the melons to be the quality required under a "good delivery" standard at the time of delivery to Sunny's customers, subject to any transit problems or delays in arrival at the customer's location; (b) Sunny would pay Oakes Produce 4.5 cents per pound for the melons loaded onto the trailers and delivered to Sunny's customers; (c) Sunny would be responsible for the cost of delivering the melons to its customers; and (d) settlement was to be made by Sunny within a reasonable time. Frances Oakes testified that Sunny agreed to pay 5 cents per pound for the load of melons represented by Sunny/Oakes purchase order number 94006/4066. However, the more credible evidence is that the agreed upon price for this load of melons was 4.5 cents per pound. Likewise, Kelly Marinaro testified that it was agreed that if the melons did not met the agreed upon quality standard upon delivery to its customers that Oakes would be responsible for all cost of delivery, including freight. However, the more credible evidence is that this was not agreed upon and was not part of the oral agreement. Oakes did not advise Sunny that it would give Sunny "full market protection" on the melons, or that Sunny was to handle the melons "on account" for Oakes. The more credible evidence shows that the watermelons were purchased by Sunny with title to the melons passing to Sunny upon delivery to Sunny's customers and meeting the agreed upon quality standard. 8 Under the terms of the above oral agreement, Oakes loaded 9 loads of melons onto trucks furnished by Sunny that were shipped to Sunny's customers. Oakes alleged in the complaint that Sunny had failed to pay Oakes for 6 of the 9 loads and owed a balance of $9,521.36. However, at the beginning of the hearing, Oakes withdrew from the complaint the load of melons represented by Sunny Oakes/Oakes purchase order number 93924/4069 in the amount of $1,976.40 leaving an alleged balance owed to Oakes by Sunny of $7,544.96. The 5 loads of melons left in contention are the loads represented by Sunny/Oakes purchase order numbers 93891/4051, 93905/4063, 93921/4064, 94006/4066, and 93941/4096, in the amounts of $1,778.66, $2,044.80, $1,859.40, $91.70, and $1,770,40, respectively. Sunny contends that the melons on the loads represented by Sunny/Oakes purchase order numbers 93891/4051, 93905/4063, 93921/4064, and 93941/4096 arrived at their destination in a condition below the agreed upon quality standard which resulted in prices received by Sunny of less than the agreed upon price of 4.5 cents per pound. Based on this contention, Sunny deducted the freight, other applicable costs and its sales charge from the amount alleged to have been received for the melons represented by Sunny/Oakes purchase order numbers 93905/4063, 93921/4064, and 93941/4096, which resulted in Oakes not receiving any payment from Sunny for those melons. In fact, each of the 3 loads of melons showed a negative balance which was charged against other loads with a positive balance. The price received by Sunny for the load of melons represented by Sunny/Oakes purchase order number 93891/4051 resulted in a balance owed Oakes of $547.50 after deductions for freight and other charges. However, in making payment to Oakes, Sunny charged the negative balances of the loads represented by Sunny/Oakes purchase order numbers 93905/4063, 93921/4064 and 93941/4096 against Sunny/Oakes purchase order number 93891/4051, which resulted in Oakes not receiving any payment for this load. 13 As to the load represented by Sunny/Oakes purchase order number 94006/4066, Sunny paid Oakes $825.30, which represents 4.5 cents per pound for 18,340 pounds without any deduction for loads with negative balances. Oakes has been paid in full for this load. There was insufficient evidence to show that the melons represented by Sunny/Oakes purchase order numbers 93891/4051, 93905/4063, 93921/4064, and 93941/4096 did not meet the agreed upon quality standard upon arrival at their destination. There was no dispute as to the weight of the melons. Sunny furnished Oakes trouble reports on the 4 loads of melons represented by Sunny/Oakes purchase order numbers 93981/4051, 93905/4063, 93921/4064, and 93941/4096, indicating problems with the condition of the melons and that the loads would have to be "worked" in order to "move" the melons. Kelly Marinaro testified that either he or employees of Sunny had discussed at least 3 of these reports with Frances Oakes, and that he had authorized Sunny to do what was necessary to move the loads of melons. Frances Oakes testified that he had seen these trouble reports and had discussed at least some of them with either Kelly Marinaro or Sunny's employees. However, Frances Oakes further testified that he was not aware that there was a severe problem with the melons. The more credible evidence is that Kelly Marinaro or an employee of Sunny's discussed these trouble reports with Frances Oakes, and that Frances Oakes authorized Sunny to find someone to "work" the melons. In disposing of the melons, Sunny received less than the agreed upon price of 4.5 cents per pound. Therefore, Sunny deducted the freight, other applicable costs, and Sunny's sales charge which resulted in a negative balances of $81.84, $582.35, and $345.02 for loads represented by Sunny/Oakes purchase order numbers 93905/4063, 93921/4064, and 93941/4096, respectively. There was a positive balance of $547.50 for the load of melons represented by Sunny/Oakes purchase order number 93891/4051. By check dated August 1, 1996, Sunny made an accounting to Oakes which included the loads of melons in dispute and others that were not in dispute. Each purchase order number was listed on the check stub with either a positive or negative amount. The check was in the amount of $4,413.34. This amount was calculated by adding positive amounts and subtracting negative amounts. This was clearly shown on the check stub which Oakes received. On the back of this check Kelly Marinaro had clearly printed "Troubled Settlements Payment In Full" Using its deposit stamp which was stamped directly beneath the language "Troubled Settlements Payment In Full," Oakes deposited this check.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department enter a Final Order dismissing Oakes' complaint. DONE AND ENTERED this 18th day of July, 1997, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6947 Filed with the Clerk of the Division of Administrative Hearings this 18th day of July, 1997. COPIES FURNISHED: Honorable Bob Crawford Commission of Agriculture The Capitol, Plaza Level-10 Tallahassee, Florida 32399-0810 Richard Tritschler General Counsel Department of Agriculture and Consumer Services The Capitol, Plaza Level-10 Tallahassee, Florida 32399-0810 Brenda Hyatt, Chief Bureau of Licensing and Bond Department of Agriculture and Consumer Services 508 Mayo Building Tallahassee, Florida 32399-0810 Frances A. Oakes, pro se 2722 Edson Avenue Fort Myers, Florida 33916 Arthur C. Fulmer, Esquire Post Office Box 2958 Lakeland, Florida 33806 Robert Walman Claims Management Services American Bankers Insurance Company of Florida 11222 Quail Roost Drive Miami, Florida 33157
Findings Of Fact Robert J. Walsh and Company, Inc. has been in the business of selling agricultural products since 1962. It is a "dealer in agricultural products" as defined in s. 604.15(1), Florida Statutes (1985). It is not a "producer" as defined in s. 604.15(5), Florida Statutes (1985). Walsh's modus operandi which it has used for many years is to have its salesmen call on landscapers, nurseries and other customers for trees, plants and other agricultural products to determine their needs. These salesmen have the prices of products and their availability from producers and the salesmen take orders from these purchasers. This order is sent to the producer who delivers the product to the purchaser and sends Walsh a copy of the delivery ticket. Walsh bills the customer for the product delivered and the producer bills Walsh for the consumer-cost of the product less a 20-25 percent discount from which Walsh derives its profit from the sale. The producer relies solely on Walsh for payment for the product it produces and delivers to the customer. Walsh has no authority to sell the product at a price other than that set by the producer. In any event, the producer bills Walsh for the product delivered at the producer's established price less the discount it gives Walsh for acting as intermediary in the sale. If products are damaged in transit, the producer's driver will make any necessary adjustment with the customer or return the damaged plant for replacement by the producer. Walsh does not represent the grower if such a situation develops. Similarly, if the product is rejected by the purchaser for not meeting quality standards, that issue is resolved between the grower and the customer without input from Walsh. Whatever agreement is reached between the grower and the customer is reflected on the invoice signed by the customer and forwarded to Walsh who has the responsibility of collecting from the customer. The grower bills Walsh for the cost of the product less Walsh's commission. The sales forming the bases for the complaints filed by Walsh with Respondent involve sales to Paul Pent, d/b/a Paul Pent Landscape Company, Dean Pent and J & W Landscape. On January 31, 1985, Walsh sold Pent three laurel oaks grown by Stewart Tree Service for a total price of $467.46 including sales tax (Ex. 2). On March 27, 1985, Walsh sold various trees and plants grown by Goochland Nurseries to J & W Landscape for a total price of $403.98 (Ex. 3). On April 22, 1985, Walsh sold two live oaks grown by Stewart Tree Service to Pent Landscape Company for a total price of $336.00 (Ex. 4). On July 3, 1985, Walsh sold various plants grown by Goochland Nurseries to J & W Landscape for a total price of $564.96 (Ex. 5). On all of these sales the producers billed Walsh for the product and were paid by Walsh. Walsh billed the customers who did not pay and Walsh filed the complaints (Ex. 8, 9 and 10), denied by Respondent on grounds Walsh was not an agent or representative of the producers. In 1976, Petitioner filed a complaint against the bond of the Ernest Corporation, a licensed dealer in agricultural products and received $5,589.20 from Respondent who recovered from the bonding company. In the complaint Walsh alleged that it was agent for Southeast Growers, Inc., selling their nursery stock throughout Florida. Respondent's witnesses could not recall what additional evidence they saw to conclude that Walsh was, in fact, an agent for the producer. However, these witnesses all testified that had they then believed Walsh was solely responsible to the producer for payment for the products sold they would not have concluded Walsh was the agent or representative of the producer. The bond on which Petitioner is attempting to recover provides that if the principal "shall faithfully and truly account for and make payment to producers, their agents or representatives, as required by Sections 604.15 - 604.30, Florida Statutes, that this obligation to be void, otherwise to remain in full force and effect." (Ex. 11 and 12)
Conclusions The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of these proceedings. Section 604.21, Florida Statutes (1985) provides in pertinent part: Any person claiming himself to be damaged by any breach of the conditions of a bond or certificate of deposit, assignment or agreement given by a licensed dealer in agricultural products as herein before provided may enter complaints thereof against the dealer and against the surety, if any, to the department, which complaint shall be a written statement of the facts constituting the complaint. Section 604.15(1) , Florida Statutes (1985) provides: "Dealers in agricultural products" means any person, whether itinerant or domiciled within this state, engaged within this state in the business of purchasing, receiving, or soliciting agricultural products from the producer or his agent or representative for resale or processing for sale; acting as an agent for such producer in the sale of agricultural products for the account of the producer on a net return basis; or acting as a negotiating broker between the producer or his agent or representative and the buyer. (emphasis supplied) One of the complexities of this case which leads to some confusion is the fact that both Pent and Walsh were dealers in agricultural products as above defined. Walsh fits into the category of a person claiming himself to be damaged by a breach of any condition of the bond of Pent. However, he has the burden of showing that he is a person covered by the bond. According to the terms of the bond, coverage is provided only for "producers, their agents or representatives." Walsh is clearly not a producer in this case but claims coverage as an agent or representative. In construing "agent" or "representative" the legislative intent should be considered. The purpose of these provisions of the statute requiring licensing and bonding of dealers in agricultural products, as expressed in Section 604.151, Florida Statutes, is to protect producers from economic harm. Economic harm sustained by an agent or representative is imputed back to the principals, which in this case are the producers. An agency may be defined as a contract either expressed or implied upon a consideration, or a gratuitous undertaking, by which one of the parties confides to the other the management of some business to be transacted in the former's name or on his account, and by which the latter assumes to do the business and render an account of it. 2 Fl. Jur. 2d "Agency," Section 1. Here, Walsh was selling agricultural products on its own account, which products it was purchasing from the producers. The producer sold its product to Walsh and delivered it to the address Walsh indicated. The customer receipted for the product and the producer billed Walsh for the total cost, including transportation, to the ultimate buyer, less the 20-25 percent commission Walsh received. Walsh paid the producer and billed the customer. Whether or not Walsh collected from the customer had no bearing on the debt Walsh owed the producer for the product. It could be said that the producer was the agent for Walsh in delivering the product to the user. Even though Walsh never had actual possession of the product the sale to Walsh was complete when the producer delivered the product to the user. The entire transaction clearly is a buy-and-sell operation by Walsh and not Walsh acting as an agent for the producer. The fact that Walsh sells the producer's product does not make Walsh the agent or representative of the producer, when the producer holds only Walsh responsible to pay for the product. Nor was Walsh a representative of the producers. Representative is defined in Webster's New Collegiate Dictionary (1977 Ed.) as: "standing or acting for another esp. through delegated authority." Walsh had no delegation of authority to act for the producer. Walsh had no authority to modify the price, settle disputes, or any other function normally performed by a representative. The above interpretation of those having standing to file a complaint against a dealer in agricultural products is the same interpretation of the applicable statutory provisions that is made by Respondent. As stated in Natelson v. Dept. of Insurance, 454 So.2d 31 (Fl 1st DCA 1984): Agencies are afforded a wide discretion in the interpretation of a statute which it [sic] administers and will not be overturned on appeal unless clearly erroneous. The reviewing court will defer to any interpretation within the range of possible interpretations. (citations omitted). This interpretation limiting recovery on an agricultural bond to producers and their agents or representatives is certainly within the range of possible interpretations, especially considering the purpose of these statutory provisions to be the protection of the economic well being of the producer. From the foregoing, it is concluded that Robert J. Walsh & Company, Inc. was not the agent or representative of Goochland Nurseries and Stewart Tree Service and does not have standing to file a complaint against Dean Pent, d/b/a Pent Landscape Company, and Paul Pent, d/b/a Paul Pent Landscape Company, and their surety, Transamerica Insurance Company.
Recommendation It is recommended that a Final Order be entered dismissing the petition as contained in Petitioner's letter dated March 24, 1986. ENTERED this 14th day of July 1986 in Tallahassee, Leon County, Florida. K. N. AYERS Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 14th day of July 1986. COPIES FURNISHED: Honorable Doyle Conner Commissioner of Agriculture The Capitol Tallahassee, Florida 32301 Robert Chastain, Esquire General Counsel Mayo Building, Room 513 Tallahassee, Florida 32301 Thomas M. Egan, Esquire Phillip Kuhn, Esquire Post Office Box 7323 Winter Haven, Florida 33883 Ronnie H. Weaver, Esquire Mayo Building, Room 513 Tallahassee, Florida 32301 Mr. Joe W. Right Bureau of Licensing & Bond Department of Agriculture Mayo Building Tallahassee, Florida 32301
The Issue Whether Petitioner, JWD Trees, Inc., is entitled to payment from Landscape Service Professionals, Inc., and the Gray Insurance Company, as Surety, pursuant to sections 604.15 through 604.34, Florida Statutes (2014), for the purchase of trees; and, if so, what amount.
Findings Of Fact The Parties JWD is a Florida licensed dealer in agricultural products pursuant to chapter 604, Florida Statutes. JWD’s primary business is buying and selling trees, but it also operates a tree farm in Lee County, Florida. JWD is principally located in North Fort Myers, Florida. J.W. Drott, III, is the president and Dennis Boddison is the vice-president of JWD Trees. Mr. Drott has 20 years of experience in buying and selling trees. Mr. Boddison has 16 years of experience in the tree business. Respondent Landscape is a Florida licensed dealer in agricultural products, pursuant to chapter 604. Landscape is a full-service landscape business located in Tamarac, Florida. Sandy Benton is the president and Tom Benton is vice-president of Landscape. Ms. Benton started Landscape in February 1998. Respondent Insurance Company filed a denial of the claim and was represented at hearing by Landscape’s counsel. Southeastern Shade is a registered nursery and has been in the business of growing trees for approximately nine years. John Nemcovic and his wife, Shelley, own and operate Southeastern Shade. Southeastern Shade supplied the 278 slash pines that JWD brokered to Landscape. JWD and Landscape had a prior business relationship. JWD was on Landscape’s list of pre-approved vendors. The Setting At all relevant times, Landscape was a contractor responsible for installing landscaping at the Palm Beach County Solid Waste Authority (SWA) site on Jog Road in Palm Beach County, Florida. Landscape was vetted for the SWA project, which was a big project for Landscape. In September 2014, Ed Conk,1/ Landscape’s plant buyer, sought bids on a list of plants for the SWA job. The list included slash pine trees. According to the bid sheet, the slash pines were to be 16 feet, 18 feet, and 20 feet in height, and in quantities of 176, 167, and 118 respectively. There was nothing in the request for bids, or JWD’s actual bid that addressed how long the slash pine trees were hardened off, or whether or how they had been root pruned. On or about October 1, 2014, Mr. Drott, on behalf of JWD, submitted a written bid to Mr. Conk to provide 461 slash pines.2/ Landscape accepted the JWD bid, but only ordered 210 slash pines. Other slash pines were bought through other vendors and delivered to the SWA site. The 210 slash pines were delivered over the course of three days: November 11, 12, and 13, 2014. Authorized personnel of Landscape received, inspected, and accepted the 210 slash pine trees. No problems or concerns were expressed regarding the delivery or condition of the slash pines. A week later, Mr. Conk ordered 68 additional slash pine trees from JWD. JWD delivered the additional slash pines on November 19, 2014. The Dispute Giving Rise to this Proceeding Landscape’s personnel documented receipt of the initial slash pines over a three-day period: November 11, 12, and 13, 2014. Once the slash pines were unloaded, they were “laid it on the ground and my water truck watered them down.” The personnel also documented the planting of the slash pines; however, the exact location of JWD’s trees in the SWA site map was not clearly established. The slash pines were planted at the SWA site either on the day of delivery or the day after delivery. There was an irrigation system in place for watering the newly planted trees; however, it was not fully functional when the initial slash pines were planted. A water truck was used to water the trees. The SWA site had significant rainfall at times, and the ground was underwater during part of the pertinent period. It is unclear when the additional slash pine trees were planted: either on the day of delivery (November 19) or the following day (November 20). Several weeks after the slash pines were planted, some of the slash pines started to deteriorate. Mr. Drott was notified that there was a beetle issue with the slash pines in early December 2014. Mr. Drott contacted Mr. Conk. Mr. Drott advised Mr. Conk to get the affected trees out of the area and to put a spray program in effect immediately to address the beetle infestation. On January 7, 2015, Mr. Boddison, Mr. Conk, Mr. Nemcovic, and Guy Michaud, Landscape’s foreman for the SWA site, conducted an SWA site visit. Mr. Nemcovic thought the beetle problem was causing the slash pines to deteriorate. Mr. Boddison noted that the SWA site was cut out of a large native pine wood flat, with a large retention area. Mr. Boddison also questioned Mr. Conk and Mr. Michaud about how the trees were unloaded, how they were handled and planted, and since there was an evident beetle infestation, what was being done as preventative maintenance. In March 2015, Lynn Griffith, an agricultural consultant, conducted an SWA site visit. Mr. Griffith noted that a majority of the pines were healthy, but there were some that were not doing well; that some had holes in them indicative of a pine beetle infestation. Upon receiving a written report from Mr. Griffith in mid-March 2015, Mr. Drott provided the report to Mr. Conk. In early April 2015, Landscape invited a Palm Beach County extension agent William Schall, the SWA project landscape architect Leo Urban, representatives of the prime contractor, Mr. Griffith, and selected Landscape employees to conduct a site visit at the SWA site. Mr. Drott was not invited to the inspection. Three dead trees were pulled out during this inspection. Only one of the dead trees was attributed to JWD. Mr. Schall admitted that he did not know of other stress factors on the SWA site, and had only been told (by Landscape personnel) about how the trees were handled. Mr. Schall acknowledged that the SWA site was a prior pine tree area, and that pine beetles could be in the area. Further, he observed that at least one of the trees was planted too deep, which could add stress to newly planted trees. Mr. Urban confirmed that there was an engineering problem at the SWA site, and the retention basin held water for longer periods of time than it should have. Mr. Urban confirmed that the SWA site was a prior pine forest. Additionally, during the April 2015 SWA site visit, Mr. Urban pointed out to Landscape personnel that there were four pines planted close to standing water. Landscape moved those four pines. When Mr. Griffith was invited to the April 2015 SWA site visit, he was under the impression that all the interested parties would be there. Neither JWD nor Mr. Nemcovic was present. Mr. Griffith theorized potential factors leading to the demise of the slash pine trees: once water stress is introduced to newly transplanted trees, especially field-grown trees as is this case, it is hard for the trees to recover; the over-watering of the newly transplanted trees may have inadvertently washed away a significant amount of the spray that was used to treat the beetle infestation; or poor roots. Mr. Griffith observed, from two trees “yanked” out of the ground, “very little in the way of new root initiation.” He went on to speculate that it was possible that any roots could have rotted off from over- irrigation, could have been knocked off during the unloading and planting of the trees, or could have been ripped off when the trees were pulled. However, no pathology diagnosis was conducted to determine what, if any, root disease was present or if the roots suffered from over watering. In April 2015, Mr. Drott received communications from Landscape indicating that the cause of the slash pine trees demise was attributed to the lack of hardening off or root issues. This was Mr. Drott’s first notice that “hardening off” of the roots, and not the beetle infestation, was the cause of the slash pines’ demise. Mr. Hoyt’s review of the case materials was extensive. He reviewed Landscape’s discovery responses, including the daily job reports, two reports by Mr. Griffith, Mr. Schall’s report, and photographs that were provided by JWD and Landscape. He participated in an SWA site visit in September 2015, as well as a site visit and interview of the principals of Southeastern Shades in October 2015. He attended Landscape’s expert deposition and read his report, and inspected root balls and photographs of root balls, which Landscape purported to be from JWD. Mr. Hoyt also spoke with other JWD customers. He also attended the three-day hearing. Slash pine trees are very sensitive and can be easily stressed. Stress can be caused by a variety of factors including: transplanting; harsh handling; bark exposure to sunlight, including superficial wounds to the bark; too much or too little water; or planting too deeply. The stress will cause a tree to emit chemicals that attract beetles, which inhabit the trees and may kill a stressed tree within a week or two of the infestation. Based on the totality of his review, Mr. Hoyt opined that a combination of factors contributed to the SWA slash pines to deterioration: excess watering, planting to deep, rough handling, and the beetles. His testimony is found credible. Mr. Harris’ opinion centered on only one possible explanation for the trees’ demise: a failure to have an adequate root system or an inability of the roots to generate new growth. Landscape personnel were unable to definitively identify the dead trees as being trees supplied by JWD. There were photographs introduced at the hearing that were initially marked as being from one supplier, then changed to another. There is a lack of clarity in identifying which supplier actually supplied the now demised trees. Landscape has not paid for, and refuses to pay for the 210 slash pine trees reflected in JWD’s invoice no. 16707. The total amount of the invoice is $42,567.80. The additional 68 slash pines were on invoice no. 16818, which has been paid, and these are not the subject of this case. JWD is entitled to payment in the amount of $42,567.80 for the slash pine trees it provided to Landscape. Besides the amount set forth above, JWD claims the sum of $50.00 paid for the filing of the claim against Landscape and its bond. The total sum owed to JWD by Landscape is $42,617.80.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that that a final order be entered by the Department of Agriculture and Consumer Services: Approving the claim of JWD Trees, Inc., against Landscape Professional Services, Inc., in the total amount of $42,617.80 ($42,567.80 plus $50 filing fee); and if Landscape Professionals Services, Inc., fails to timely pay JWD Trees, Inc., as ordered, that Respondent, The Gray Insurance Company, as Surety, be ordered to pay the Department of Agriculture and Consumer Services as required by section 604.21, Florida Statutes, and the Department reimburse the Petitioner as set out in section 604.21, Florida Statutes; and Ordering Landscape Professional Services, Inc., to pay JWD Trees, Inc., reasonable costs and attorney's fees. Jurisdiction is retained to determine the amount of costs and attorney's fees, if the parties are unable to agree to the amount. DONE AND ENTERED this 4th day of March, 2016, in Tallahassee, Leon County, Florida. S LYNNE A. QUIMBY-PENNOCK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of March, 2016.
The Issue Whether Respondent Quality By Design, Inc. (QBD) owes Petitioner $2,166.75, or some lesser amount, for 45 Washingtonia Palms it purchased from Petitioner in June 2009.
Findings Of Fact Based on the evidence adduced at hearing, and the record as a whole, the following findings of fact are made: Petitioner is a producer of Washingtonia Palms and other trees. It grows these agricultural products on its 140-acre tree farm located in Moore Haven, Florida. The farm utilizes a ditch/canal irrigation system. In June 2009, Petitioner received two separate orders from QBD for a total of 45 Washingtonia Palms, ten-to-14 feet in overall height: a June 16, 2009, order for 27 trees (Invoice 1081); and a June 24, 2009, order for 18 trees (Invoice 1083). For both orders, the agreed-upon purchase price was $45.00 per tree. Accordingly, the amount due, including sales tax (of $85.05), for the trees ordered on June 16 was $1,300.05, and the amount due, including sales tax (of $56.70), for the trees ordered on June 24 was $866.70. QBD took delivery of the trees at Petitioner's tree farm. David Lindsey and Buddy Ward were the truck drivers dispatched by QBD to Petitioner's tree farm to take delivery of the trees. Mr. Lindsey picked up the 27 trees that had been ordered on June 16. Mr. Ward picked up the 18 trees that had been ordered on June 24. Petitioner readied the trees for delivery before they were picked up. Among the things it did as part of the preparation process was to wrap the root ball of each tree in plastic sheeting to retain moisture. After arriving at Petitioner's tree farm, Mr. Lindsey and Mr. Ward each inspected the trees Petitioner had readied for pick up and accepted them on behalf of QBD (Mr. Lindsey by signing Invoice 1081, and Mr. Ward by signing Invoice 1083). After being inspected and accepted, the trees were loaded onto Mr. Lindsey's and Mr. Ward's semi-trailer trucks and transported to QBD's tree farm in Umatilla Florida, approximately five hours away (by truck). Each of the 45 trees was in excellent condition when loaded. Mr. Lindsey's trip to QBD's tree farm was uneventful. Mr. Ward, on the other hand, was not so fortunate. As he was leaving Petitioner's property, he drove his semi-trailer truck into a ditch while making a turn. Mr. Ward was not seriously injured, and none of the trees fell off the trailer bed as a result of the mishap. A tow truck was called to the scene. Within 15 minutes of the tow truck's arrival, Mr. Ward's truck was pulled out of the ditch and he "went on [his] way," with his load of 18 Washingtonia Palms. The morning after they arrived at QBD's tree farm, the trees on Mr. Lindsey's and Mr. Ward's trucks were offloaded and "watered down." They were then put in the ground. Subsequently, fronds on each of the trees "turned brown." QBD was able to "rehabilitate" the trees by cutting off the outside row of fronds on each tree and "re-tying the heads." The labor cost of this "rehabilitation" work was $13.50 per tree. The QBD employees who did the work used a piece of equipment that QBD rented at the rate of approximately $75.00 per hour. At no time prior to the initiation of the instant litigation did QBD notify Petitioner that any of the 45 trees it had purchased was defective or non-conforming, nor did it seek to revoke its acceptance of the trees or to return the trees to Petitioner.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order (1) finding that QBD is indebted to Petitioner in the amount of $2,166.75 for the 45 Washingtonia Palms it purchased from Petitioner in June 2009; (2) directing QBD to make payment to Petitioner in the amount of $2,216.75 ($2,166.75, plus $50.00 for reimbursement of the filing fee Petitioner paid) within 15 days following the issuance of the order; (3) providing that Petitioner, upon receipt of this payment, shall remit $141.75 to the appropriate taxing authority; and (4) announcing that if QBD fails to make timely payment in full, the Department will seek recovery from OCIC, QBD's surety. DONE AND ENTERED this 14th day of April, 2010, in Tallahassee, Leon County, Florida. S 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 14th day of April, 2008.
The Issue The primary issue in this hearing was the existence of a contract between M. Stembridge and Jack's Fruit Company under which monies were owed Stembridge.
Findings Of Fact Prior to August 5, 1974, Mrs. Barbara Stembridge, who was in the grove caretaking business, called Mr. Jack Goldtrap by telephone relative to the sale of citrus fruit on properties managed by her for her mother-in-law and herself. Their discussion regarding the sale of the fruit and the terms was incorporated with the contract, Exhibit 1, which Mr. Goldtrap sent to Mrs. Stembridge together with a check for $7500. Mrs. Stembridge executed the contract, accepted the check, and returned the executed contract to Mr. Goldtrap. This contract recites that Mr. Goldtrap had purchased " all fruit on the following groves at market price at time of picking less 50 cents plus picking cost". Thereafter the contract lists the groves subject to the contract: "Home Bloc, Poor Prospect and R. F. Stembridge grove." The testimony was uncontroverted that the fruit which is the subject of the instant controversy was located within the groves enumerated in the contract, however, Mrs. Barbara Stembridge stated that it had not been her intent to sell the fruit in controversy, but she was uncertain whether this was communicated to Mr. Goldtrap prior to the execution of the contract. Mr. Goldtrap testified that he felt he had purchased all the fruit on the groves as stated in the contract. The Hearing Officer finds that the contract, Exhibit 1, takes precedent over any prior verbal agreement between the parties to the contract and that Mr. Goldtrap purchased all fruit in the grove identified therein. Mrs. Barbara Stembridge and R. M. Stembridge testified that subsequent to the written contract with Mr. Goldtrap that R. M. Stembridge entered into an oral agreement to purchase the fruit in controversy from Mrs. Stembridge (the mother of R. M. Stembridge and mother-in-law of Mrs. Barbara Stembridge, who is the sister-in-law of R. M. Stembridge). R. M. Stembridge desired the fruit for sale in his roadside stand at his service station, and planned to pick the fruit in controversy himself on a piecemeal basis over several months. Pursuant to her mother-in-law's Instructions, Mrs. Barbara Stembridge contacted T. G. Mixon, a field superintendent with 31 years experience to estimate the value of the fruit in controversy. T. G. Mixon looked at the trees and crop in controversy late in 1974 and estimated in value to R. M. Stembridge as $3/box; however, he qualified his estimate stating that this was only a valid estimate of its value to R. M. Stembridge based on his particular intended use and that its market value was no where near that figure. R. M. Stembridge paid the agreed upon price of $900 to his mother-in-law for the fruit in controversy. Prior to picking the fruit he had purchased, Mr. Goldtrap visited the groves and was shown the groves, their boundaries, and the fruit in controversy by Mrs. Barbara Stembridge's foreman. This fruit was red grapefruit which is generally unsuitable for juice production. Such fruit cannot be economically picked for juice because there is no market for the unacceptable fruit. Mr. Goldtrap was advised by Mrs. Stembridge's foreman that Mr. Stembridge was interested in the fruit. Mrs. Barbara Stembridge testified that she thought that her foreman had told an unknown person that the red grapefruit had been promised to her brother-in-law. Mr. Goldtrap decided not to pick the red grapefruit, but to leave the fruit on the trees, and instructed his picking crew supervisors to check with R. M. Stembridge to determine which of the fruit be desired. In addition to the red grapefruit in controversy, R. M. Stembridge also had agreed to purchase white grapefruit from approximately 10 trees adjoining his service station, a fact unknown to Mr. Goldtrap or his supervisors. When the supervisors called on Mr. Stembridge to find out which trees should be spared, Stembridge thinking that they were referring to the white grapefruit trees near his station and that they had been shown the red grapefruit trees by his sister-in-law's foreman told them to begin their picking and when they got down to the station he would show them the trees to spare. Mrs. Barbara Stembridge's foreman did not instruct the picking supervisors and the picking crew picked the red grapefruit in controversy. When Mr. Stembridge became aware of the reds having been picked, he contacted Mr. Goldtrap. Mr. Stembridge was very irate and Mr. Goldtrap was very apologetic not fully realizing how the fruit had been picked when it had been his intent to spare the fruit. At this point, Stembridge demanded $3/box for the fruit, and Mr. Goldtrap stated that was a high price. Thereafter, in either this conversation or a subsequent one, Stembridge stated perhaps he knew a man who would buy them, however, when contacted this individual was not interested. When Goldtrap was advised of this, Goldtrap said he would send another truck and collect the red grapefruit. The issue presented in this controversy, therefore, becomes a question of whether there was a transaction between Mr. Goldtrap and Mr. R. M. Stembridge. It is clear from the contract, Exhibit 1, that Mr. Goldtrap owned the fruit in question at the time Mr. Stembridge "purchased" the fruit from his mother. Goldtrap intended to leave the fruit because of it low value and instructed his supervisors to contact Stembridge so that Stembridge could identify the trees in which be was interested. However, these trees were not identified by Stembridge because Stembridge thinking the supervisors were referring to the white grapefruit trees, did not indicate the trees he desired. Therefore, Goldtrap's intent to relinquish his right to the fruit was never effectively communicated to Mrs. Barbara Stembridge or to R. M. Stembridge. Mr. Stembridge's demand for $3/box for the grapefruit was in essence a demand for damages and not an offer for sale. Even if it were viewed as an offer (overlooking Stembridge's lack of ownership), there is no evidence that Goldtrap accepted the offer. His response was to advise Stembridge that he would send another truck to pick up the fruit. This action was consistent with his prior contract with Barbara Stembridge to purchase all the fruit in the groves and his legal obligation. See Section 601.64(3), Florida Statutes. The testimony was clear that Mr. Goldtrap had not paid out the moneys received from the sale of the red grapefruit because of the questions raised by R. M. Stembridge. However, Barbara Stembridge has filed no complaint in this matter, and based upon the foregoing findings that there is no transaction or contract between R. M. Stembridge and Goldtrap, R. M. Stembridge is not entitled to an accounting or to payment for the fruit in controversy.
