The Issue Whether Respondents violated Sections 475.25(1)(e), (k), Florida Statutes, and Chapter 61J2-14, Florida Administrative Code.
Findings Of Fact Petitioner, Department of Business and Professional Regulation, Division of Real Estate (Division), is a state licensing and regulatory agency charged with the responsibility and duty to prosecute administrative complaints pursuant to Chapters 455 and 475, Florida Statutes. Respondent, Lynda J. Lobsitz (Lobsitz), is and was at all material times to this proceeding licensed as a real estate broker in accordance with Chapter 475, Florida Statutes, having been issued license number 0377747. Respondent, Jaclo, Inc. (Jaclo), is and was at all times material to this proceeding, a licensed real estate brokerage corporation, having been issued license number 0275422. During May 1997, the Division conducted an office inspection and escrow audit of Respondents' real estate office. On the day of the audit, Respondents maintained an escrow account for rental security deposits, which account had an adjusted trust liability of $85,300.89.1 The adjusted bank balance was $85,185.22, resulting in a shortage of $115.67. Respondents prepared bank reconciliation reports for January, February, March, and April 1997 for the rental security deposit account and for the rental escrow account. Attached to each of the reports was the monthly bank statement for the account and period covered in the bank reconciliation report. The bank statements identified the name of the bank, the name of the account, the account number, the account balances and dates. A list of outstanding checks, identifying the outstanding checks by date and number, was attached to each report. The dates used to reconcile the balances were not included in the bank reconciliation reports. For the January 1997 bank reconciliation report for the rental rents deposits account, there was a difference of $7,616.25. Respondents stated on the report that $7,630.00 was for a check which was returned for endorsement. The report further stated that $13.75 had not been located. For the February 1997 bank reconciliation report for the rental rents deposits account, there was a difference of $1,756.75. The report contained an explanation for the difference and the corrective action taken. For the March 1997 bank reconciliation report for the rental rents deposits account, there was a difference of $500 which was explained with the corrective action noted. For the bank reconciliation report for January 1997 for the rental security deposit and account, there was an overage of $531.33. The report stated that the amount had not been located. For the bank reconciliation for the rental security deposit and account for February, 1997, there was an overage of $2,234.33. The report explained that $1,700 was a bank error deposit; $3.00 was sales tax which was to be transferred to rents account; and the remaining $531.33 could not be located. For the bank reconciliation for the rental security deposit and account for March 1997, there was an overage of $31.33. The explanation and corrective action stated on the report was "Bank wire to incorrect account Mushlin will transfer from rents accounts. $531.33 have not located." For the bank reconciliation report dated April 1997 for the rental security account, there was an overage of $531.33 with the explanation of "Have not located difference."
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding that Respondents violated Sections 475.25(1)(e), Florida Statutes, issuing a reprimand for the Respondents, requiring that Respondent Jaclo, Inc., pay an administrative fine of $100, and requiring that Respondent Lynda J. Lobsitz take a seven-hour broker management course. DONE AND ENTERED this 14th day of July, 1998, 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 Filed with the Clerk of the Division of Administrative Hearings this 14th day of July, 1998.
Findings Of Fact The Respondent, Robert Watson, Jr., is a real estate broker-salesman, having been issued license Number 0093690. He resides and has his business in Jacksonville, Florida. On or about September 1, 1978, the Respondent negotiated and drafted a contract for sale of a certain piece of residential real estate, the purchaser for which was one Mr. Lacy Cole. The Respondent was Mr. Cole's broker in that transaction. The Respondent informed Mr. Cole that he would have to pay a two- hundred-dollar deposit as prospective buyer pursuant to the deposit receipt, sales contract agreement drafted by the Respondent. Mr. Cole did not pay the entire two-hundred-dollar deposit, but he did pay the Respondent sixty-five dollars. The closing was held October 20, 1978, at which time Mr. Cole's attorney directed the Respondent to pay Mr. Cole a two-hundred-dollar refund as the contract for sale provided that financing would be through the Veterans Administration and that in such a Veterans Administration sponsored transaction the buyer is precluded from paying closing costs. Mr. Cole cashed the two- hundred-dollar check in good faith and later was informed that the Respondent had stopped payment on it, which resulted in Mr. Cole having to make the check good. The Respondent has failed to recompense Lacy Cole for the sixty-five- dollar deposit he had already paid pursuant to the contract for sale drafted by the Respondent. Mr. Watson has also never repaid the two hundred dollars which Mr. Cole had to expend in order to provide payment on the two-hundred-dollar check on which the Respondent had stopped payment. In response to the Petitioner's demonstration that the Respondent had obligated Mr. Cole for a two-hundred-dollar "binder or closing costs" which he was not obligated to pay under Veterans Administration policy, the Respondent stated that he wrote the contract with the two-hundred-dollar binder with the understanding that Cole would pay a portion of it at the first of each month until it was paid and that he only received a total of sixty-five dollars from Cole. The seller agreed to sell the property to Mr. Cole anyway. The Respondent maintained that he merely told Mr. Cole at the closing that he would write him a two-hundred-dollar check and deliver it to him at closing with the understanding that Cole would deliver it back to him immediately afterward to keep from confusing the attorney." The Respondent, however, failed to refute the showing by the Petitioner that the Respondent attempted to obligate that purchaser to pay two hundred dollars in "closing costs" which he was not legally obligated to pay and for which the seller of the property was responsible in the first place. The Respondent adduced no evidence contrary to that of Petitioner which established that, after being informed by the attorney that Mr. Cole was not responsible for any deposit or closing costs, the Respondent still retained the sixty-five dollars paid him as earnest money by Mr. Cole and, further, that after stopping payment on Cole's refund check, causing Mr. Cole to incur two hundred dollars additional expense for which he was not obligated, the Respondent failed to recompense Cole. There is thus no question that the Respondent misrepresented to his client, Mr. Cole, the obligations and expenses Mr. Cole would have to incur in order to purchase the property and thus, in effect, wrongfully obtained two hundred sixty-five dollars from Mr. Cole. On or about September 16, 1978, Mrs. Joanne Wesley deposited a ten- dollar check with the Respondent as a partial deposit for a down payment on a home. On or about September 20, 1978, she deposited an additional one-hundred- dollar check with the Respondent as further deposit on the same contract for sale and purchase which the Respondent had at that time not yet drafted. The Respondent never made an appropriate deposit of the above referenced checks in his escrow account, but, instead, cashed them for his personal use. On or about October 25, 1978, the contract for sale and purchase was finally drafted by the Respondent. On approximately December 4, 1978, Mrs. Wesley deposited with the Respondent an additional check for eight hundred fifty dollars as the final installment of her deposit money with regard to the proposed purchase of the home. On December 29, 1978, Mrs. Wesley learned that she had failed to qualify for FHA financing with regard to the above-referenced contract and, after looking at another home which was not to her liking offered to her by the Respondent as a "replacement dwelling," finally requested the refund of her total deposit of nine hundred sixty dollars. The Respondent then requested Mrs. Wesley to wait until January 2, 1979, for that refund and on January 2, 1979, tendered to her four hundred dollars cash as partial reimbursement. On January 3, 1979, the Respondent tendered to her an additional three hundred dollars cash and drew and delivered to her his escrow check, post-dated to January 10, 1979, in the amount of two hundred fifty dollars. That escrow account check was returned for insufficient funds. On February 1, 1979, Mrs. Wesley's attorney made demand on the Respondent for payment of the two hundred fifty dollars outstanding, represented by the invalid check. On approximately February 3, 1979, the Respondent ultimately paid the two hundred fifty dollars due Mrs. Wesley. Thus, at that point the Respondent had refunded nine hundred fifty dollars of the nine hundred sixty dollars in deposit money due Mrs. Wesley. The entire refund had become due on December 29, 1978, when it was learned that she could not qualify for FHA financing with regard to the proposed purchase, which qualification for financing was a condition precedent to performance of the contract. In his defense the Respondent stated that he attempted to arrange the purchase of another dwelling for Mrs. Wesley upon learning that she could not qualify for financing on the subject property and that he retained her deposit money in his escrow account for that reason and ultimately repaid it to her, although after over a month's delay. The Respondent contended that he had opened the subject account as a business account when he was doing appraisal work and had not considered it to be an escrow account and "did not know when they switched it over to escrow." The Respondent did acknowledge that he had used this escrow account as his business account and commingled personal and business operating funds in it and made withdrawals from time to time for business and personal reasons. With further regard to the Cole transaction, the Respondent contended that he felt it was customary for a veteran to pay two hundred dollars closing costs and even when he learned the veteran was not obligated to pay closing costs in such a transaction, that he still felt it was "customary as earnest money" even though the seller obviously was obligated to pay closing costs. The Respondent also testified that as of the time of the hearing and for an indeterminant period of tinge before the hearing, he had terminated active practice of real estate brokerage and was mostly performing appraisal work. There is thus no question that the Respondent informed Mr. Cole that he was obligated to pay two hundred dollars "earnest money" or "closing costs" and that his actions forced Mr. Cole to incur the two-hundred-sixty-five dollar expense described above, even after the Respondent was informed by the closing attorney that the purchaser was not obligated for those expenses. There is no question with regard to the Wesley transaction that he delayed an inordinate amount of time in refunding her deposit money after the condition of financial qualification for the purchase did not occur, and, further, that he commingled these purchaser deposit funds in his escrow account with personal and business funds and used a portion of them for personal purposes.
Recommendation Having considered the foregoing findings of fact and conclusions of law, the evidence of record, the candor and demeanor of the witnesses and the pleadings and arguments of the parties, it is RECOMMENDED that the license of Robert Watson, Jr., as a real estate broker in the State of Florida be REVOKED. DONE AND ENTERED this 1st day of February, 1982, in Tallahassee, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of February 1982. COPIES FURNISHED: Barry S. Sinoff, Esquire 2400 Independent Square One Independent Drive Jacksonville, Florida 32202 Robert Watson, Jr. 9527 Abedare Avenue Jacksonville, Florida 32208 Frederick B. Wilsen, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Samuel Shorstein, Secretary Department of professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 C. B. Stafford, Executive Director Board of Real Estate Department of Professional Regulation Post Office Box 1900 Orlando, Florida 32802
The Issue The issue for consideration in this case is whether the Respondent's licenses as a real estate broker should be disciplined because of the matters set forth in the Administrative Complaint filed herein.
Findings Of Fact At all times pertinent to the allegations of misconduct in the Administrative Complaint, the Petitioner, Division of Real Estate, was the state agency charged with the responsibility for the licensing and regulation of the real estate profession in this state. The Respondent, Richard L. Bohner, was licensed as a real estate broker in Florida operating, with his wife, Kirsten, Bohner Real Estate, located at 205 E. Osceola Street in Stuart, Florida. On October 1, 1989, Mr. Bohner as owner/lessor, entered into separate rental agreements with Trudy Dohm and Thelma Reynolds, with Bohner Real Estate identified as agent, for the lease for 12 months each of apartments number 105 and 204, respectively, at 1674 S.E. St. Lucie Blvd. in Stuart, Florida, for a monthly rental of $350.00 each. Each lease provided for the placement of a security deposit and last month's rental in advance; those sums, according to the terms of the lease, to be held by the agent, Bohner Real Estate, in a non- interest bearing escrow account at the Florida National Bank in Stuart. In actuality, the sums above-mentioned were, in each case, deposited into an account at the First National Bank and Trust Company in Stuart. This account, number 8000030400, was held in the name of Richard L. Bohner or Kirsten L. Bohner, Trust account. This account was an interest bearing account and, over the time in question, also received several large deposits of funds by or on behalf of the Respondent, Richard L. Bohner which were his personal funds and not funds received as a part of or in conjunction with his activities as a real estate broker or those of Bohner Real Estate. For the most part, the funds placed in that account were Bohner's personal funds and security deposits and last month's rent on apartments in the building owned as a personal investment by Mr. and Mrs. Bohner. On February 20, 1990, Sharon Thayer, an investigator for the Department, in the normal course of business, went to the Respondent's real estate office, unannounced as was her prerogative, and asked to speak with Mr. Bohner. He was not present at the time and she asked Mrs. Bohner, who was present, to produce the Respondent's books for the brokerage's escrow account, which she did. In the course of their conversation, Mrs. Bohner identified herself as being in partnership with the Respondent and admitted to assisting him in the maintenance of the escrow account. When Ms. Thayer asked for the backup documents for the escrow account, these were produced. Ms. Bohner also provided Ms. Thayer with copies of the bank account she maintained. On inquiry, Mrs. Bohner said the deposits thereon were, in the main, representative of rental and security deposits from tenants on leases which Bohner Real Estate managed. Ms. Thayer asked about the large deposits made on May 3, June 7, and July 7, 1989. These were for $104,542.50, $50,000.00, and $4.600.00 respectively. In response, Mrs. Bohner indicated these were personal monies which came from personal sources and funds which had been put in that account because that's where they would get the most interest. They were not escrow funds related to the real estate brokerage. Ms. Thayer made an appointment to return to the brokerage office on February 23, 1990 to speak with Respondent. When she did so, Mr. Bohner accounted for the trust liability of $6,885.00 which existed on that date. This sum was verified with the bank by phone. The trust account had an overage of somewhat more than $881.00 which Respondent explained as accrued interest not removed from the account. Mr. Bohner admitted at hearing that he earned interest on the security and rental deposits he held in that account and used that earned interest to offset the low rentals he charged his tenants. He asserted, and there was no evidence to rebut this assertion, that the only security and rental deposits placed in that account were from tenants in the apartment building he and his wife owned personally. Neither he nor Bohner Real Estate managed or served as rental agent for any rental properties owned by others. It is so found. Ms. Thayer pointed out, and it is accepted as fact, that a broker is required to reconcile his trust account on a monthly basis and file a monthly reconciliation form which accounts for overages and shortages. Respondent admits he had not completed or filed these reconciliations because neither he nor Bohner Real Estate has a trust or escrow account into which client funds are deposited. He manages no property from which rents would be collected other than his own, and when he takes a deposit on a sale or transfer, a separate trust account is opened for that particular transaction with any interest earned going to the buyer. Petitioner showed, through the testimony of Ms. Casale, the bank records custodian, that the largest deposit in issue, that one in excess of $100,000.00, was the result of the maturity of a certificate of deposit that was transferred to the account in question. Respondent did not endorse the check for deposit or sign any deposit document. He submitted a letter from the bank chairman to support his thesis that he was not a party to the transfer, but the letter, admitted over objection by counsel for Petitioner, indicates the deposit was made by the bank's investment counselor who handled the transaction consistent with telephone instructions given her by the Respondent. This is a collateral matter, however. When Ms. Thayer completed her audit, she prepared and filed a report on which she indicated, inter alia, that the office met inspection standards and that the property management escrow/trust account was satisfactory. She noted an overage of $889.31 in the account and that it was an interest bearing account although the leases state it would be non-interest bearing. No deadline was given for the correction of this item. Mrs. Bohner admits that when she gave the apartment security escrow account to Ms. Thayer at her request and described it as a trust account, she was not thinking. In fact, and it is so found, neither Respondent nor Bohner Real Estate have a trust account for the business and have not had one for several years. She reiterates Mr. Bohner's assertion that the only money usually kept in the account referenced by Ms. Casale and referred to by Ms. Thayer, is money received as security deposits and last month's rental from tenants in their own building. In the absence of any evidence to the contrary, it is so found.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that a Final Order be entered in this case dismissing all allegations of misconduct by Respondents as outlined in the Administrative Complaint filed herein. RECOMMENDED in Tallahassee, Florida this 1st day of April, 1992. ARNOLD H. POLLOCK 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 1st day of April, 1992. APPENDIX TO RECOMMENDED ORDER The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. FOR THE PETITIONER: - 3. Accepted and incorporated herein. Accepted. - 7. Accepted and incorporated herein. Accepted and incorporated herein. First sentence accepted and incorporated herein,. Balance is not Finding of Fact but lore legal conclusion. Accepted and incorporated herein. Accepted and incorporated herein. FOR THE RESPONDENTS: None submitted. COPIES FURNISHED: Theodore Gay, Esquire Department of Professional Regulation 401 NW Second Avenue, Suite N-607 Miami, Florida 33128 Richard L. Bohner Bohner Teal Estate 205 East Osceola Street Stuart, Florida 34994 Jack McRay General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate 400 W. Robinson Street Post Office Box 1900 Orlando, Florida 32802 - 1900
The Issue Whether Respondent committed the violations alleged in the Administrative Complaint? If so, what disciplinary action should be taken against her?
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made: The Department is a state government licensing and regulatory agency. Respondent is now, and has been at all times material to the instant case, a licensed real estate broker in the State of Florida holding license number 0005609. She is 72 years of age. The money she earns as a real estate broker helps to supplement her retirement income. In the almost 40 years that she has been broker, the only complaint that has been made against her in connection with the practice of her profession is the complaint that is the subject of the instant case. Peter Rettig is a longtime acquaintance of Respondent's. He too is a Florida real estate broker. Rettig is the operating and qualifying broker for La Costa Real Estate, Inc. In September of 1993, as a favor to Rettig, Respondent agreed to act, without compensation, as Rettig's escrow agent. Thereafter, Rettig deposited trust funds received from his buyer/clients in the "Mary A. Belotto Escrow Account" (account number 3431110272) that Respondent had established at Barnett Bank. On various occasions from September of 1993, to July of 1994, Respondent, unthinkingly, appropriated a portion of these funds for her own personal use, but acted swiftly to replace the appropriated funds with her own personal funds. As a result, no one was actually harmed by her actions. During this period of time, Respondent was suffering from severe emotional distress and a resulting inability to think clearly due to the death of her husband and the subsequent death of a close friend who had provided her with needed assistance and support following her husband's death. On January 18, 1995, Edward Gruskin, an investigator with the Department, conducted an office inspection/audit of La Costa Real Estate, Inc. and the "Mary A. Belotto Escrow Account." The inspection/audit revealed that Respondent had engaged in the conduct previously described in Finding of Fact 11 of this Recommended Order and that, in addition, she had failed to prepare and sign monthly reconciliation statements for her escrow account. Respondent now realizes that she erred in engaging in such conduct and in failing to prepare and sign these reports. She has apologized for making these errors and has promised, with apparent sincerity, not to repeat them in the future.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law it is hereby RECOMMENDED that the Commission enter a final order finding Respondent guilty of the violations alleged in the Administrative Complaint and fining her $250.00, issuing her a reprimand, and placing her on probation for a period of three years for having committed these violations. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 14th day of September, 1995. STUART M. LERNER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 14th day of September, 1995. APPENDIX TO RECOMMENDED ORDER The following are the Hearing Officer's specific rulings on the findings of fact proposed by the parties in their proposed recommended orders: The Department's Proposed Findings 1-2. Accepted and incorporated in substance, although not necessarily repeated verbatim, in this Recommended Order. 3. Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer. 4-5. Accepted and incorporated in substance, except for 5c. and 5d., which have not been incorporated in this Recommended Order because they would add only unnecessary detail to the factual findings made by the Hearing Officer. Respondent's Proposed Findings First unnumbered paragraph: To the extent that this proposed finding states that Respondent is 72 years of age and has been a real estate broker in the State of Florida for almost 40 years, it has been accepted and incorporated in substance. Second unnumbered paragraph: Accepted and incorporated in substance. Third unnumbered paragraph: Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer. Fourth and fifth unnumbered paragraphs: Accepted and incorporated in substance. Sixth unnumbered paragraph: Rejected as a finding of fact because it is more in the nature of argument than a finding of fact. Seventh unnumbered paragraph- First sentence: Accepted and incorporated in substance; Second sentence: Rejected as a finding of fact because it is more in the nature of argument than a finding of fact. COPIES FURNISHED: Daniel Villazon, Esquire Senior Attorney Department of Business and Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802 Mary A. Belotto 1571 Southeast 23rd Avenue Pompano Beach, Florida 33062 Henry M. Solares, Division Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Lynda L. Goodgame, Esquire General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue Whether the Certificate of Registration of the Respondent as a real estate broker should be suspended or revoked For alleged violation of Sections 475.25(1)(a), 475.25(1)(c), 475.25(1)(i), and 475.25(3), Florida Statutes, as alleged in the Administrative Complaint filed February 11, 1976. A final hearing was scheduled to be held on June 29, 1976, but pursuant to Motion of Respondent was continued until July 6, 1976 and, pursuant to a further Motion of Respondent For continuance, the hearing was continued until November 15, 16, 1976. A prehearing Motion of Respondent to strike Counts I, II, III, V, VII, VIII, IX & X of the Administrative Complaint was denied at the commencement of the hearing. At the hearing, Petitioner moved to amend Count X of its Complaint to correct a typographical error as to the statutory provision alleged to have been violated. The Motion was granted and the said Count was amended to reflect an alleged violation of Section 475.25(3), F.S. rather than Section 475.25(1), F.S. Pursuant to further Motion of Petitioner, a typographical error appearing in Count VII of the Administrative Complaint relating to the address of the property in question shown in paragraph 1 thereof was corrected to read "1558". Pursuant to further Motion of petitioner, Count Seven was also amended to include an alleged violation of Section 475.25(1)(i), F.S. No objections to any of the above amendments were made by Respondent.
Findings Of Fact Respondent is a registered real estate broker, Certificate No. Q056337. During the year in which the alleged statutory violations occurred, i.e., 1974, she was also registered under the trade name "Watson Real Estate". Also, effective November 4, 1974, she was additionally registered in the name of Connie B. Martin. Her place of business was listed at 17031 North Dixie Highway, North Miami Beach, Florida. (Petitioner's Exhibits 1, 2) On April 16, 1974, Respondent, in the name of "Connie Martin and/or Nominees" entered into an Agreement of Sale and Deposit Receipt with Richard Infante and Susan Infante, his wife, whereby Respondent agreed to purchase real estate located at 1558 N.W. 102nd Street, Miami, Florida, For the price of $24,607.50. The contract provided For a $1,000.00 security deposit by the purchaser in the Form of a check payable to "Watson Real Estate Trust Account" and the Agreement recited an acknowledgement of receipt of these escrow funds by Constance B. Mastellone For Watson Real Estate. The Agreement further provided that closing of the transaction would be on June 23, 1974 and that, in the event of failure or refusal of the purchaser to comply with the obligations thereunder, without fault on the sellers' part, all monies paid under the contract could be retained by the sellers as liquidated damages. Respondent did not place the $1,000.00 deposit in the Watson Real Estate Trust Account that was maintained in the City National Bank of Miami Beach, Miami Beach, Florida. Instead, she wrote a letter to the Infantes on the same day that the contract was executed advising them that the money was in an interest-bearing account at Chase Federal Savings, North Miami Beach, Florida. The letter stated that she preferred to handle the matter in that manner because there was a possibility she would not be able to obtain financing and close the purchase. Although Respondent testified that Mr. Infante called and told her that he had received the letter and had expressed no objection to this disposition of the funds, no written instrument or addendum to the contract in this respect was ever executed by the parties. (Petitioner's Exhibit 14; Respondent's Exhibit 16). The transaction with the Infantes did not close on the scheduled date because Respondent was unable to obtain mortgage financing. On July 1, 1974, Respondent, in the name of "Connie B. Martin, broker" as seller, entered into a deposit receipt agreement with Carrie Clark, as purchaser to sell the Infante property For the sum of $25,000.00. The deposit receipt reflected that the sum of $1,450.00 was acknowledged to be held in escrow by Watson Real Estate as a deposit on the property. There was no showing in this Agreement that Respondent did not hold title to the property at the time. The contract was contingent upon the delivery by the seller of an FHA appraisal of not less than $25,000.00. The Agreement reflected that "Watson Real Estate, Connie B. Martin, Broker" had received the aForesaid deposit. Under the same date of July 1, 1974, another deposit receipt was executed by Carrie Clark as buyer, whereby "Watson Real Estate Trust Account, Connie B. Martin", acknowledged receipt of $1,450.00 from Carrie Mae Clark on the same property as a deposit to be held in escrow by Watson Real Estate. This document showed the purchase price to be $24,607.50. It did not reflect the name of the proposed seller of the property. At the time she executed these documents, Clark did not know who owned the property in question. Respondent viewed Clark as her "Nominee, as referred to in the original contract with the Infantes, and had contracted with Clark on the assumption that she could deliver clear title to her when she had received the same from the Infantes. Respondent considered this transaction to be what she termed a "double closing". Her original contract with the Infantes provided that she would receive as "Watson Real Estate, Connie B. Martin, Broker", 40 percent of the real estate commission on the sale with 60 percent to be paid to the listing broker, Edwin C. Bagby. (Testimony of Respondent, Clark, Petitioner's Exhibit 8; Respondent's Exhibit 6). During the next several months after June, 1974, Respondent advised Infante and his attorney Benjamin Agronow, that she was endeavoring to sell the house to Clark. Infante was desirous of selling the property and did not press to close the transaction. He hereby tacitly agreed to an extension of the time For closing. However, when the Clark deposit receipt was submitted to Agronow in early November, 1974, he advised Infante that the changed method of financing therein would result in higher costs to him. By this time Infante wanted no further dealings with the Respondent and declined to consider the offer by Clark. Thereafter, on November 12, 1974, Agronow advised the Respondent that she had breached the contract of April 16, 1974 For, failure to close the transaction, and demanded delivery of the $1,000.00 deposit under the terms of the contract. It provided that upon default of the purchaser all monies paid thereunder could be retained by the seller as liquidated damages and the contract terminated. Respondent did not pay over the deposit funds to Infante. (Testimony of Respondent, Agronow, Infante (Deposition), Respondent's Exhibit 6, Petitioner's Exhibit 14). On May 25, 1974, Respondent, in the name of "Connie B. Martin and/or Nominees" as purchaser, entered into an Agreement Of Sale And Deposit Receipt with Ruth E. Higgins, as seller, to purchase property located at 1065 N.W. 127th Street, Miami, Florida, For the sum of $31,000.00. The contract provided For the payment of $1,000.00 in the Form of a check to "Watson Real Estate trust account", escrow agent, as a security deposit, and receipt was acknowledged of this amount on the same date by Constance B. Mastellone For Watson Real Estate Trust Account. The contract further provided that it was a "back-up" contract and would not become effective until the date that Higgins was notified that a previous contract with one Hyde was known to be void. Respondent was advised several months later that the Hyde transaction had failed. Neither the listing broker, Associates Real Estate, nor Higgins saw the $1,000.00 at the time the aForesaid agreement of May 25 was entered into by the parties. A letter of Respondent to Higgins on the same date as the contract was executed stated that Respondent held the deposit of $1,000.00 in her account with Chase Federal Savings, North Miami Beach, Florida, in an interest-bearing account. It further stated that Respondent did not want to lose the interest during the time spent waiting For a mortgage commitment. Respondent testified that Higgins called her on the phone and told her she had received the letter and accepted the provisions thereof. Respondent encountered difficulties in obtaining financing For the purchase due to a tight money market and there was also a title problem to be resolved. In any event, the deal did not go through and Respondent obtained a release of the deposit receipt to herself which was executed by Higgins on December 19, 1974. Respondent admitted at the hearing that at no time was the $1,000.00 deposit ever placed in the Watson Real Estate trust account. (Testimony of Respondent, Higgins, Shaeffer; Petitioner's Exhibit 15; Respondent's Exhibits 8, 10, 11, 12, 13). On December 10, 1974, Respondent's daughter, Pamela A. Mastellone entered into an Agreement Of Sale And Deposit Receipt as purchaser of the Higgins property For the sum of $34,000.00. This agreement provided For a security deposit in the sum of $3,000.00 in the Form of a check payable to Ruth E. Higgins. The check was issued by Connnie Mastellone" on December 10, 1974 and was drawn on the City National Bank of Miami Beach. The contract further provided that if it did not close by December 24, 1974, the contract would be null and void and the parties relieved of all obligations. The agreement provided For an even split of a 7.5 percent commission between Associates Realty and Watson Realty. Respondent testified that at the time she gave the check to Higgins, she asked her to hold it until a firm commitment from a mortgage company had been received. Higgins, on the other hand, testified that Respondent had asked her to hold it For two weeks. Respondent was unable to get mortgage financing For her daughter and the contract expired by its terms on December 24, 1974. On December 27, 1974, Higgins deposited the check For payment and it was returned For insufficient funds. (Testimony of Respondent, Shaeffer; Petitioner's Exhibits 16, 17, 18; Respondent's Exhibit 14). On June 18, 1974, Respondent in the name of "Connie B. Martin" as purchaser entered into an Agreement Of Sale And Deposit Receipt with Rose Gilbert, represented by Jean Fielding, Attorney in fact, to purchase real estate located at 16150 N.E. 12th Avenue, North Miami Beach, Florida, For the price of $26,000.00. The Agreement provided that upon signing of the contract, the purchaser would place $2,00.00 in escrow with Watson Real Estate Trust Account and receipt was acknowledged of this sum by Constance B. Mastellone For Watson Real Estate. The contract provided For a 50-50 commission split between Watson Real Estate and Pete Lipinsky, listing broker. At the time the contract was executed, Lipinsky told Respondent that if she did not place the money in escrow, he would "nail her hide to the wall". Respondent testified that she instructed her daughter, Pamela Mastellone, to go to the Chase National Bank and withdraw $2,100.00 and send the same to the Watson Realty Trust Account at City National Bank of Miami Beach. She further testified that it was not until she was investigated by petitioner that she learned her daughter had neglected to follow her instructions in this regard. The contract did not close on the agreed date and thereafter, on September 20, 1974, Respondent, in the name of "Constance B. Mastellone, Broker" entered into another Agreement Of Sale And Deposit Receipt with Gilbert on the same property For a price of $29,000.00. Although this Agreement provided For a security deposit of $2,600.00 to be placed in the Watson Real Estate Account, the parties understood that these were the same funds deposited under the Former contract. This deal closed on October 14, 1974. (Testimony of Respondent, Fielding, Lipinsky; Petitioner's Exhibits 6, 7; Respondent's Exhibits 1, 2). On May 28, 1974, Peter A. Mastellone and Respondent, in the name of "Constance B. Mastellone, Broker, and/or Nominees" was purchaser entered into an Agreement Of Sale And Deposit Receipt with Roy M. Hall and Kitty H. Hall, his wife, to purchase property located at 1517 N.W. 101st Street, Miami, Florida, For the price of $17,000.00. The contract provided For a $1,000.00 check payable to Watson Real Estate Trust Account as escrow agent as a security deposit, and receipt of the said deposit was acknowledged by Constance B. Mastellone on behalf of Watson Real Estate. The contract further specified that the property was being purchased For the purpose of resale and provided For a closing within 30 days. The contract provided that there would be no real estate commission paid on the transaction. Also, on May 28, 1974, Respondent directed letters to the Halls advising them that the $1,000.00 security deposit was in her account at Chase Federal Savings, North Miami Beach, an interest- bearing account, and that she did not want to place it in an escrow account where it would earn no interest. Respondent testified that the Halls orally agreed the deposit money could stay in the savings account of Respondent. This contract did not close, but on August 9, 1974, Respondent executed an FHA deposit receipt as seller whereby she agreed to sell the property to Nicholas Torek and Mary McDonnell Torek For the sum of $23,000.00. The document acknowledged the receipt of a $500.00 security deposit, which was in the Form of a check issued to Watson Real Estate by M.L. McDonnell on August 11, 1974, to be placed in the Watson Real Estate Account. Respondent was unaware at the time that McDonnell and Torek were not married. Torek had authorized McDonell to use his name on the instrument because they were planning to be married. Respondent sent them to a mortgage company to qualify For a mortgage. Several days later, she learned that they were not married and Torek came back and signed a new contract, which was also dated August 9, with the Halls at the same purchase price as his contract with Respondent. The latest agreement provided For a security deposit of $1,250.00 to be held in escrow by Watson Real Estate Trust Account and also provided For a real estate commission to Watson Real Estate of $3,750.00 to be paid by the Halls. An addendum to this contract was executed by Torek and Respondent, dated August 9, 1974, whereby Torek agreed that the $1,250.00 escrow should not be deposited in the trust account, but be given to Peter A. Mastellone For the purpose of making repairs on the property. It further provided that he would hold $850.00 toward closing costs and "prepayables". The document reflects the receipt of $2,100.00 by Peter A. Mastellone. Respondent testified that since $2,100.00 was all that was necessary to close the transaction, her husband returned $500.00 cash to Torek to reimburse McDonnell For her original deposit on the other contract. The Halls were not a party to the addendum to the contract and Torek was not aware that the Halls were the owners of the property until after the transaction was closed on October 4, 1974. Torek testified that he had not signed the second August 9 contract which had been executed by the Halls. However, Torek had agreed to close in his own name when he learned that McDonnell could not qualify For FHA financing. Torek was not concerned about the name in which the transaction was consummated but later, after disputes with McDonnell, quitclaimed his interest to her. Although McDonnell was present at the closing on October 4, the deed to the property was issued in the name of Torek only. McDonnell testified that Respondent had told her to sign the original contract In the name of Torek and in that way the deed would come out in her married name. McDonnell was surprised when the deed was issued only in the name of Torek. McDonnell was aware that the Halls owned the property and that Respondent was attempting to sell it in order to get out from under her own contract with the Halls. McDonnell was not aware that Torek had signed the subsequent agreement in his name only. (Testimony of Respondent, Torek, McDonnell, Petitioner's Exhibits 10, 11, 12, 13; Respondent's Exhibits 5 & 20).
Recommendation That the registration of Constance B. Mastellone as a real estate broker be suspended For a period of six months For violation of subsections 475.25(1)(a), 475.25(1)(c), and 475.25 (1)(i), Florida Statutes. DONE and ENTERED this 3rd day of January, 1977, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Manuel E. Oliver, Esquire Staff Attorney Florida Real Estate Commission 2699 Lee Road Winter Park, Florida James, A. Baccus, Esquire Attorney For Respondent Triangle Building 595 N.W. 91st Street Miami, Florida 33150 ================================================================= AGENCY FINAL ORDER ================================================================= FLORIDA REAL ESTATE COMMISSION ANATOL ARIAN, Petitioner, PROGRESS DOCKET NO. 2788 vs. DADE COUNTY DOAH NO. 76-472 CONSTANCE B. MASTELLONE, Respondent. /
Findings Of Fact Petitioner is a 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, F.S., Chapters 120, 455, and 475, F.S., and the rules promulgated pursuant thereto. Respondent Charles B. Harvey, Jr. is now and was at all times material hereto a licensed real estate broker in the State of Florida having been issued license number 0474466 in accordance with Chapter 475, F.S. The last license issued was as a broker t/a Commercial & Investment Realty, 1116D Thomasville Road, P. O. Box 785, Tallahassee, Florida 32317. On or about April 17, 1992, Petitioner's Investigator Juanita Waller conducted a routine office/inspection audit of Respondent at 1116D Thomasville Road, Tallahassee, Florida and discovered that Respondent's trust account #077780-00242743 had an approximate shortage of $3,343.07, calculated as $29,205.00 in total trust liability but only $25,861.93 as reconciled bank balance. Thereafter, the Respondent wrote Investigator Waller and provided evidence that a portion of the missing funds was caused by an $875 "bad check" which had been deposited into his escrow account. Additionally, Investigator Waller found that Respondent failed to properly reconcile his escrow account by comparing the total trust liability with the reconciled bank balance of the trust account, as required by the rules of the Commission. Rather, he had been balancing his checkbook only. Respondent has been completely cooperative with Petitioner agency and upon notification of his errors and omissions immediately began the process of correcting the procedures used in reconciling his escrow account in accord with the requirements of the agency. He also immediately made restitution from his own monies to his escrow account as soon as he was made aware what had happened. It is noted that reconciliation of monthly written statements were not required by the agency until shortly before Respondent was investigated, however he had a duty to apprise himself of all statutes and rules and to govern himself accordingly. Likewise, he accepted "full responsibility" for allowing funds from individual clients' accounts to be used to pay for expenses incurred by other clients' properties, and has taken steps to prevent such occurrences in the future. No loss has been incurred by any party. Respondent has made good any payments owed.
Recommendation Upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED That a Final Order be issued and filed by the Florida Real Estate Commission finding the Respondents not guilty of breach of trust but guilty of culpable negligence as charged in Count I of the Administrative Complaint, guilty of having failed to maintain trust funds in escrow as charged in Count II of the Administrative Complaint, and guilty of having failed to properly reconcile his escrow account as charged in County III of the Administrative Complaint and further ordering that all the Respondent's licenses, registrations, certificates and permits be reprimanded and placed on probation for a period of one year and Respondent be required to pay an administrative fine of $300 (total) within sixty (60) days of the entry of the Final Order and that before the end of the probationary period he successfully complete and provide satisfactory evidence to the Florida Real Estate Commission of having successfully completed the thirty (30) hour Brokerage Management course, these education hours to be in addition to any other professional education required by the Respondent by the licensing provisions of this state, and further providing that if all these requirements not be successfully fulfilled as required by the Final Order, then all the Respondent's licenses, registrations, certificates and permits shall be suspended until all such requirements are completed but in no event shall such suspension exceed ten (10) years. RECOMMENDED this 12th day of January, 1993, at Tallahassee, Florida. ELLA JANE P. DAVIS 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 12th day of January, 1993. APPENDIX TO RECOMMENDED ORDER 92-6154 DOAH CASE NO. 92-6154 The following constitute specific rulings, pursuant to S120.59 (2), F.S., upon the parties' respective proposed findings of fact (PFOF) Petitioner's PFOF: 1-5 Accepted. 6 Accepted as modified. Respondent's filed no PFOF: COPIES FURNISHED: Charles B. Harvey, Esquire 1018-104 Thomasville Road Tallahassee, FL 32303 James H. Gillis, Esquire Department of Professional Regulation Division of Real Estate P. O. Box 1900 Orlando, FL 32802 Jack McRay General Counsel 1940 North Monroe Street Tallahassee, FL 32399-0792 Darlene F. Keller Division Director 400 West Robinson Street Post Office Box 1900 Orlando, FL 32802-1900
The Issue In this disciplinary proceeding, the issues are whether Respondents, who are licensed real estate brokers, failed to reconcile their brokerage escrow account properly; failed to maintain trust funds in an escrow account as required; filed a false report or record; obstructed or hindered Petitioner’s investigator in an official investigation; failed to account for and deliver trust funds; committed various acts of fraud, misrepresentation, dishonest dealing, or culpable negligence in any business transaction; or committed any of these enumerated offenses, as alleged by Petitioner in its Administrative Complaint.
Findings Of Fact The Parties Respondent Rudolph Dyer (“Dyer”) is a licensed real estate broker subject to the regulatory jurisdiction of the Florida Real Estate Commission (“Commission”). Respondent Golden Key Realty, Inc. (“Golden Key”) is and was at all times material hereto a corporation registered as a Florida real estate broker subject to the regulatory jurisdiction of the Commission. Dyer is the president and a director of Golden Key, and at all times relevant to this case he had substantial, if not exclusive, control of the corporation. Indeed, the evidence does not establish that Golden Key engaged in any conduct distinct from Dyer’s in connection with the transactions at issue. Therefore, Respondents will generally be referred to collectively as “Dyer” except when a need to distinguish between them arises. Petitioner Department of Business and Professional Regulation, Division of Real Estate, has jurisdiction over disciplinary proceedings for the Commission. At the Commission’s direction, Petitioner is authorized to prosecute administrative complaints against licensees within the Commission’s jurisdiction. Escrow Account Irregularities and Related Misconduct On or about November 14, 2001, Petitioner conducted a routine audit of Dyer’s records. Pursuant to the audit, Catherine Rivera (“Rivera”), Petitioner’s investigator, determined that as of October 31, 2001, the balance in Dyer’s escrow account was $127. Rivera determined further that Dyer’s trust liability, i.e. the total amount of money that Dyer should have been holding in escrow on his clients’ behalf, was $2,870. Thus, there existed a shortfall of $2,743 in Dyer’s escrow account. In light of this discovery, Rivera requested that Dyer provide additional records, including previous bank statements and the reconciliation statements that licensed brokers must prepare each month showing either that their trust liabilities and bank balances are in agreement or explaining why they are not. Dyer was unable to produce these records, whereupon Rivera advised him that Petitioner would initiate disciplinary proceedings. On or about April 26, 2002, after being formally notified of pending administrative charges arising from the aforementioned deficiencies concerning his escrow account and associated records, Dyer sent Rivera a letter in which he a) admitted having failed to reconcile his bank balances and trust liabilities and b) informed Rivera that “immediately after the audit [on November 14, 2001,] steps were taken to close out all escrow deposit accounts being held by the company.” In fact, Dyer continued to use his escrow account to hold funds in trust through June 2002; as it happened, the escrow account would not be completely closed until July 29, 2002. The undersigned is not convinced, however, that Dyer lied to Petitioner about closing the escrow account, as Petitioner here contends. Rather, given the ambiguity of the language used (“steps were taken”), the undersigned accepts Dyer’s explanation that what he intended to communicate was that activity in the escrow account was being allowed to wind down in an orderly fashion——which was substantially true. Continuing to investigate the matter, Rivera arranged to meet with Dyer at his office on June 19, 2002, to review the previously requested bank records and files. When Rivera arrived on that date, however, Dyer again failed to provide the desired documents. As a result, Rivera scheduled yet another appointment to inspect records at Dyer’s office. The next such meeting would take place on July 29, 2002. In the meantime, Petitioner served a subpoena duces tecum on Dyer’s bank and obtained a complete set of bank records, including canceled checks, pertaining to Dyer’s escrow account. On July 29, 2002, Dyer finally provided reconciliation statements for his escrow account pursuant to Rivera’s longstanding request. These statements were self-contradictory and woefully inadequate, but, if nothing else, they clearly demonstrated (and the undersigned finds) that the escrow account balance fell significantly short of Dyer’s total trust liability during the months of May through August 2001, inclusive. Indeed, there is no dispute (for Dyer admitted at final hearing), and it is hereby found, that at all times relevant to this case, Dyer was commingling trust funds with other funds, to the point that the escrow account effectively became an operating account of Golden Key. Dyer also produced documents purporting to be copies of checks drawn on his escrow account. At least seven of these copies were not genuine reproductions of the respective originals but were, instead, fakes.1 Specifically, in five instances, the payee of an escrow-account check was, according to the copies that Dyer produced, an individual whom, the inference is clear, Dyer owed escrowed funds. In reality, each such check actually had been made payable to and been uttered by Golden Key, which latter facts are irrefutably established by the bank-produced records.2 Dyer admitted that the above-described copies of checks he had produced to Petitioner were fakes, but he denied having personally altered the underlying documents to create the false copies, blaming an unnamed accountant for that misdeed, and he disclaimed advance knowledge of the tampering. The undersigned, however, does not fully believe Dyer’s explanation. Dyer had exclusive authority over the escrow account and substantial control over Golden Key’s operations. The undersigned finds it inconceivable that a stranger to the subject transactions could have knowingly falsified these particular checks, in the manner shown, without Dyer’s active assistance. Therefore, while acknowledging the possibility that Dyer himself might not have altered the documents in question, the undersigned finds that he was, at the very least, aware of and knowingly complicit in the attempted deception. The Fanfan Transactions On or about June 13, 2001, Dyer facilitated a contract between Herinslake, as seller, and Francique Fanfan (“Fanfan”), as buyer, for the purchase and sale of real property commonly known as 5435 Northwest Tenth Street, Plantation, Florida. The contract called for an initial deposit of $500 and an additional deposit of $500 to be placed with Dyer within ten days after the buyer’s acceptance. Dyer received $500 from Fanfan on June 19, 2001. In evidence as Petitioner’s Exhibit 9 is a $500 money order dated June 18, 2001, which names the sender (maker) as “Fan Fan” and lists as his address “601 W Oakland Pk Blvd, Ft Lauderdale 33311.” The undersigned infers that Petitioner’s Exhibit 9 is, in fact, a copy of the money order that Fanfan tendered to Dyer on June 19, 2001, as a deposit on the contract to purchase property from Herinslake. Petitioner alleges (and Dyer disputes) that some time after June 19, 2001, Dyer collected the agreed-upon second $500 deposit from Fanfan, making a total of $1,000 being held in escrow on Fanfan’s behalf. Petitioner asserts that Petitioner’s Exhibit 7, which is a $500 money order dated July 9, 2001, payable to Golden Key, is proof of the second deposit. Petitioner further alleges that after the contract between Herinslake and Fanfan failed to close (which is undisputed), Dyer returned $500 to Fanfan and kept $500 (which is disputed). Taken together, the testimony of Dyer and that of his former salesman, Elysee Joseph, is imprecise, confusing, and somewhat in conflict as it relates to Fanfan. They agree, however, that when the Herinslake-Fanfan transaction fell apart, Dyer returned Fanfan’s entire deposit——of $500. Dyer also points out that months later he assisted Fanfan in the purchase of a condominium unit located at 2800 Northwest Fifty-Sixth Avenue, Lauderhill, Florida. His testimony is corroborated by the settlement statement from that transaction, which is in evidence as part of Petitioner’s Exhibit 11. The settlement statement identifies the seller as Evelyn Goodison; names Francique Fanfan, “a single man,” as buyer; and indicates that the transaction closed on April 10, 2002. According to the settlement statement, Fanfan had placed a $1,000 deposit against the purchase price, and the testimony at final hearing established that Dyer had held this sum in escrow pending the closing. The undersigned finds that Petitioner has failed to prove, clearly and convincingly, that Dyer retained $500 belonging to Fanfan in connection with the aborted contract between Herinslake and Fanfan, for several reasons. First, the money order dated July 9, 2001, a copy of which is in evidence as Petitioner’s Exhibit 7, appears not to have been tendered by Francique Fanfan, the alleged victim here. This particular money order identifies the sender as “Michelle Fanfan” and gives as her address “2076 Kimberly Blvd, N Lauderdale, Fl 33068.” There is no evidence whatsoever in the record regarding Michelle Fanfan, and hence no finding can be made that she was in any way related to Francique Fanfan, who (the evidence shows) was a single man. Moreover, Michelle Fanfan’s address does not match Francique Fanfan’s address as reported in Petitioner’s Exhibit 9. Second, the undersigned believes that it is highly unlikely Fanfan would have continued to do business with Dyer if, as Petitioner alleges, Dyer had cheated him out of $500 on an earlier deal. Thus, the very fact that Fanfan purchased the Goodison property through Dyer tends to refute Petitioner’s charge. Finally, Fanfan, the alleged victim, did not testify at the final hearing, and consequently there is no direct evidence that Dyer took $500 from Fanfan. The Charges In counts I and VII of its Administrative Complaint, Petitioner accuses Respondents of having failed to properly prepare monthly escrow-reconciliation statements. Petitioner’s position is that in maintaining records showing significant shortages in the escrow account for a period of approximately six months, and by failing to take corrective action regarding the shortages, Respondents failed to comply with Rule 61J2- 14.012, Florida Administrative Code, and hence violated Section 475.25(1)(e), Florida Statutes. In counts II and VIII, Petitioner alleges that Respondents committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction, in violation of Section 475.25(1)(b), Florida Statutes. Petitioner’s position is that Respondents committed fraud or misrepresentation when they tendered false or forged documents to Rivera during the course of her official investigation. In addition, Petitioner asserts that Respondents committed culpable negligence towards the individuals who placed their funds in trust with Respondents. In counts III and IX, Petitioner asserts that Respondents obstructed or hindered the enforcement of Chapter 475, Florida Statutes, in violation of Section 475.42(1)(i), Florida Statutes, and therefore in violation of Section 475.25(1)(e), Florida Statutes. Petitioner’s position is that Respondents willfully interfered with Rivera’s investigation by submitting fraudulent documents to the investigator. In counts IV and X, Petitioner accuses Respondents of having made or filed a report or record which the licensee knew to be false, in violation of Section 475.25(1)(l), Florida Statutes. Petitioner’s position is that Respondents knowingly tendered false copies of canceled checks to Rivera. In counts V and XI, Petitioner charges Respondents with failing to account for and deliver trust funds, in violation of Section 475.25(1)(d)1., Florida Statutes. Petitioner’s position is that Respondents failed to account for and deliver the second deposit allegedly received from Fanfan in connection with the Herinslake-Fanfan transaction. In counts VI and XII, Petitioner accuses Respondents of having failed to maintain trust funds in the real estate brokerage escrow account until disbursement was properly authorized, in violation of Section 475.25(1)(k), Florida Statutes. Petitioner’s position is that during the six months of concern, Respondents’ escrow account funds were regularly several thousand dollars less than the trust liability. Ultimate Factual Determinations Dyer failed to prepare written monthly reconciliation statements as required by Rule 61J2-14.012, Florida Administrative Code, and thus he violated Section 475.25(1)(e), Florida Statutes. Petitioner therefore has established the charges set forth in counts I and VII of its Administrative Complaint, by clear and convincing evidence. The evidence does not establish that Dyer committed fraud, misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction. There is no persuasive evidence that Dyer intended to harm (or actually harmed) any of his clients. While Dyer did participate in a dishonest scheme to deceive Rivera by producing false copies of his canceled checks, this particular wrongdoing occurred, not in a business transaction, but rather in connection with a regulatory investigation. Thus, Dyer did not violate Section 475.25(1)(b), Florida Statutes. Counts II and VIII were not proved. Dyer attempted to obstruct or hinder Rivera’s investigation by producing copies of canceled checks that he knew were false and misleading. Petitioner has clearly established that Dyer violated Section 475.42(1)(i), Florida Statutes, which in turn constitutes a violation of Section 475.25(1)(e), Florida Statutes, as charged in counts III and IX of the Administrative Complaint. The evidence does not support the charge that Dyer violated Section 475.25(1)(l), Florida Statutes, which prohibits the filing false reports and records, because the altered documents that Dyer produced to Rivera were not signed by Dyer—— at least not in the sense contemplated by the statute, which specifies that “such reports or records shall include only those which are signed in the capacity of a licensed broker or salesperson.” Counts IV and X thus were not proved. The evidence does not clearly establish that Dyer failed to return a deposit of $500 to Fanfan after his deal with Herinslake fell through. Thus, counts V and XI, which allege violations of Section 475.25(1)(d)1., Florida Statutes, were not proved. Dyer failed to maintain trust funds in a segregated escrow account, in violation of Section 475.25(1)(k), Florida Statutes. Petitioner therefore has established the charges set forth in counts VI and XII of its Administrative Complaint, by clear and convincing evidence.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission enter a final order that: (a) finds Respondents guilty as charged in counts I, III, VI, VII, IX, and XII of the Administrative Complaint; (b) revokes Respondents’ respective real estate licenses; and (c) imposes an administrative fine of $3,000 against Respondents, jointly and severally. DONE AND ENTERED this 11th day of June, 2003, 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 11th day of June, 2003.
The Issue Whether Petitioner is entitled to licensure as a real estate salesperson.
Findings Of Fact Respondent is the agency of the State of Florida responsible for the licensure of real estate professionals. On October 19, 1993, Petitioner submitted to Respondent his application for licensure as a real estate salesperson. In his application, Petitioner disclosed that he had been disbarred as a member of the Florida Bar by decision of the Florida Supreme Court. The actions for which Petitioner was disbarred were described in detail by the Florida Supreme Court's decision in The Florid Bar v. Ellis S. Simring, 612 So.2d 561 (Fla. 1993). The Florida Supreme Court found that there was clear and convincing evidence that Petitioner had repeatedly and intentionally violated trust accounting procedures, had commingled trust and personal funds, and had misappropriated client funds for his personal use. The Florida Supreme Court further found that the Petitioner had violated the Court's order that temporarily suspended him from practice. Petitioner denied that he misappropriated funds from any client, but he admits the other major violations found by the Supreme Court. Petitioner testified that he was suffering from chronic fatigue syndrome and flu-like symptoms when the trust account violations occurred during 1988 and 1989. As a result of a recommendation from an acquaintance, he took large doses of Vitamin C, which aggravated his hemorrhoidal condition and resulted in bleeding. Petitioner testified that his ability to practice law was limited by his medical condition and that his income from his practice suffered as a consequence. Petitioner testified that his secretary acted as his administrative assistant during that period of time and that she was responsible for maintaining his trust account, but he did not attempt to blame her for the admitted deficiencies pertaining to his trust account. Petitioner failed to keep or retain appropriate trust account records, caused the proceeds from the sale of his personal property and from loans he had taken out to be deposited in the trust account, and caused office expenses and personal expenses to be paid out of his trust account. Petitioner settled a personal injury action in which he represented a minor child by the name of Barnett. The proceeds of the settlement in the amount of $45,000 was transferred from his trust account to that of another lawyer who was a non-practicing retired lawyer and friend of the Petitioner. The purpose of that transfer was to hide those funds from the Internal Revenue Service. The Florida Supreme Court found that Petitioner misappropriated a portion of these funds. Petitioner disputes that finding. The misconduct to which Petitioner admitted at the formal hearing and his disbarment from the practice of law by the Florida Supreme Court create a presumption, pursuant to Section 475.17(1)(a), Florida Statutes, that he is not qualified for licensure as a real estate professional. Petitioner did not offer any competent, substantial evidence which would establish that he is honest, truthful, trustworthy, and of good character or that would otherwise rebut the presumption of disqualification.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner's application for licensure as a real estate salesperson should be denied. DONE AND ENTERED this 6th day of September, 1994, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 6th day of September, 1994. COPIES FURNISHED: Ellis Stewart Simring, pro se 3785 Westminister Street Hollywood, Florida 33021 Manuel E. Oliver, Esquire Assistant Attorney General Office of the Attorney General Suite 107 South Tower 400 West Robinson Street Orlando, Florida 32801 Darlene F. Keller, Director Division of Real Estate 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802-1900 Jack McRay, Acting General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
Findings Of Fact Petitioner is an agency of the State of Florida charged with the responsibility and duty to prosecute violations of the statutes and rules regulating the practice of real estate in the State of Florida. Respondent, Benjamin C. Rolfe, is now and was at all times material hereto a licensed real estate broker in the State of Florida, having been issued license number 0318091 in accordance with Chapter 475, Florida Statutes. The last license issued to Mr. Rolfe was as a broker with Squires Realty of the Palm Beaches, Inc., 721 U.S. 1, #217, North Palm Beach, Florida. Respondent, Duane C. Heiser, is now and was at all times material hereto a licensed real estate broker in the State of Florida having been issued license number 0038233 in accordance with Chapter 475, Florida Statutes. The last license issued to Mr. Heiser was as a broker effective February 8, 1991, at Duane C. Heiser Realty Co., 1312 Commerce Lane A1, Jupiter, Florida. On or about December 12, 1998, a Final Order was issued by the Florida Real Estate Commission and received by Mr. Heiser whereby his real estate broker's license was suspended for two (2) years from January 12, 1989, through January 10, 1991. During the month of October 1989, Mr. Heiser violated the lawful suspension order of the Commission by personally delivering rental checks to and ordering the disbursement of escrow funds from the Property Management-Operating Account, which is an escrow account, of Squire's Realty Company of the Palm Beaches, Inc. Between March 22 and March 26, 1990, the escrow account records of Mr. Rolfe, who was the qualifying broker for Squire's Realty of the Palm Beaches, Inc., were audited by Petitioner's authorized representatives. The Escrow/Trust Account Audit revealed that Respondent Rolfe failed to properly document and reconcile the Property Management-Operating Account, which is an escrow account. Mr. Rolfe was responsible for this account. Mr. Rolfe was negligent regarding the management of this escrow account by allowing a suspended licensee, Mr. Heiser, access to this account. Mr. Rolfe and Petitioner stipulated that the appropriate penalty for Mr. Rolfe's violation of Section 475.25(1)(b), Florida Statutes, would be the imposition of an administrative fine in the amount of $300.00 and the placement of his licensure on probation for a period of one year. They further stipulated that the administrative fine was to be paid within thirty days of the filing of the final order. They also stipulated that during his term of probation Mr. Rolfe would be required to complete sixty hours of continuing education with thirty of those sixty hours being the thirty hour management course for brokers. They further stipulated that Mr. Rolfe would be required to provide to Petitioner satisfactory evidence of his completion of those sixty hours of continuing education and that those sixty hours of continuing education are to be in addition to any other continuing education required of Mr. Rolfe to remain active and current as a real estate broker in the State of Florida. Mr. Heiser and Petitioner stipulated that the appropriate penalty for Mr. Heiser's violation of Section 475.25(1)(b), Florida Statutes, would be the imposition of an administrative fine in the amount of $300.00 and the placement of his licensure on probation for a period of one year. They further stipulated that the administrative fine was to be paid within thirty days of the filing of the final order. They also stipulated that during his term of probation, Mr. Heiser would be required to complete sixty hours of continuing education with thirty of those sixty hours being the thirty hour management course for brokers. They further stipulated that Mr. Heiser would be required to provide to Petitioner satisfactory evidence of his completion of those sixty hours of continuing education and that those sixty hours of continuing education are to be in addition to any other continuing education required of Mr. Heiser to remain active and current as a real estate broker in the State of Florida.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered which: Dismisses Counts I, III, and V of the Administrative Complaint; Finds Mr. Heiser guilty of having violated a lawful order of the Florida Real Estate Commission in violation of Section 475.25(1)(e), Florida Statutes, as alleged in Count II of the Administrative Complaint. It is further recommended that the Final Order impose an administrative fine in the amount of $300.00 upon Mr. Heiser and place his licensure on probation for a period of one year. It is also recommended that the conditions of probation require that Respondent Heiser pay the said administrative fine within thirty days of the filing of the final order and that he be required to complete sixty hours of continuing education during his term of probation. It is further recommended that as part of the sixty hours of continuing education, Mr. Heiser be required to successfully complete the thirty hour management course for brokers, that he be required to provide satisfactory evidence of completion of such continuing education to Petitioner, and that these sixty hours of continuing education be in addition to any other continuing education required of Respondent Heiser to remain active and current as a real estate broker in the State of Florida. Finds Mr. Rolfe guilty of culpable negligience in a business transaction in violation of Section 475.25(1)(b), Florida Statutes, as alleged in Count IV of the Administrative Complaint. It is further recommended that the Final Order impose an administrative fine in the amount of $300.00 upon Mr. Rolfe and place his licensure on probation for a period of one year. It is also recommended that the conditions of probation require that Respondent Rolfe pay the said administrative fine within thirty days of the filing of the final order and that he be required to complete sixty hours of continuing education during his term of probation. It is further recommended that as part of the sixty hours of continuing education, Mr. Rolfe be required to successfully complete the thirty hour management course for brokers, that he be required to provide satisfactory evidence of completion of such continuing education to Petitioner, and that these sixty hours of continuing education be in addition to any other continuing education required of Respondent Rolfe to remain active and current as a real estate broker in the State of Florida. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 30th day of December, 1991. CLAUDE B. ARRINGTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of December, 1991. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801 Neil F. Garfield, Esquire Garfied & Associates, P.A. World Executive Building Suite 333 3500 North State Road 7 Fort Lauderdale, Florida 33319 Jack McRay General Counsel Department of Professional Regulation 1940 North Monroe Street Suite 60 Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate Department of Professional Regulation 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32801
The Issue The ultimate issue for determination at the formal hearing was whether disciplinary action should be taken against Respondent's real estate broker's license for failing to obey a lawful order of the Florida Real Estate Commission.
Findings Of Fact Petitioner is a state licensing and regulatory agency charged with the responsibility and duty to prosecute Administrative Complaints pursuant to the laws of the State of Florida. Respondent is now and was at all times material hereto a licensed real estate broker in the State of Florida. A Final Judgment was entered against Richard B. Abel, P.A., in the case of Mark Freeman v. Richard B. Abel, P.A., Case No 85-5678CA-JRT, on August 17, 1986, in the Circuit Court of the Twentieth Judicial Circuit, Lee County, Florida. The Final Judgment was for an amount of $6,839 representing real estate commissions owed by Richard B. Abel, P.A. to Mark Freeman, plus interest and attorney's fees. A two count Administrative Complaint was filed by the Florida Department of Professional Regulation, Division of Real Estate, against Respondent on June 27, 1988. The Complaint alleged inter alia that Respondent: (a) failed to satisfy a Final Judgment in Circuit Court for the payment of a real estate commission; and (b) failed to maintain trust funds in his real estate brokerage trust account or some other proper depository until disbursement in violation of Section 475.25(1)(d), (k), Florida Statutes. A Final Order was entered by the Florida Real Estate Commission (the "Commission") on December 6, 1988, accepting a Stipulation between Respondent and the Commission in settlement of the Administrative Complaint filed on June 27, 1988 (the "Final Order"). The terms of the Final Order provided that: Richard B. Abel, P.A., was reprimanded for failing to pay the Final Judgment entered against it in Circuit Court and was required to pay the amount due Mark Freeman within 45 days from the entry of the Final Order; Respondent, in his individual capacity, personally guaranteed the amount owed by Richard B. Abel, P.A., to Mark Freeman, and further agreed not to violate any provision of Chapters 455 and 475, Florida Statutes; and Respondent waived his right to contest the validity and enforcement of either the Final Order or Stipulation accepted in the Final Order. Neither Richard B. Abel, P.A., nor Respondent has paid the sums due pursuant to the terms of the Final Order entered by the Commission on December 6, 1988. The evidence submitted by Petitioner was uncontroverted. Respondent admitted that he placed the monies owed by Richard B. Abel, P.A., to Mark Freeman in the escrow account of Richard B. Abel, P.A., and disbursed the funds to himself, the sole owner, operator, director and officer. Respondent stated that he fully intended to pay Mr. Freeman when Respondent was able to do so. Respondent's sole defense was that the original debt was that of a corporation rather than a personal debt of Respondent. Respondent is in violation of the Final Order of the Comission entered on December 6, 1988.
Recommendation Based upon the foregoing Findings of Facts and Conclusions of Law, it is RECOMMENDED that Respondent be found guilty of failing to obey a lawful order of the Florida Real Estate Commission in violation of Section 475.25(1)(e), Florida Statutes, fined $1,000, and placed on probation for a period not to exceed 5 years. The conditions of probation may include any of those prescribe in Florida Administrative Code Rule 21V-24.001(2)(a) except those prescribing re-examination or being placed on broker-salesman status. In the event Respondent fails to pay in full any fine imposed on Respondent or to complete the terms of any probation imposed on Respondent, it is recommended that Respondent's license be suspended for 8 years. DONE and ENTERED this 4th day of December, 1989, in Tallahassee, Leon County, Florida. DANIEL MANRY 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 4th day of December, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-3727 Petitioner has submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number(s) in the Recommended Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. Respondent did not submit proposed findings of fact. The Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection Included in Finding 1 Included in Finding 2 Included in Finding 4 Included in Finding 5 5-6 Included in Finding 6 7-8 Included in Finding 7 9 Included in Finding 9 COPIES FURNISHED: James H. Gillis, Esquire Departmen of Professional Regulation 400 West Robinson Street Orlando, Florida 32801 Mr. Richard B. Abel 2478 Inagua Avenue Miami, Florida 33133
