The Issue The issues in the case are whether J. D. Tree Service, Inc. (Respondent), conducted business in violation of a previously- issued Stop-Work Order, and, if so, whether the Department of Financial Services, Division of Workers' Compensation (Petitioner), properly calculated the applicable penalty assessment.
Findings Of Fact The Petitioner is the state agency charged with the responsibility to enforce chapter 440, Florida Statutes (2010),1/ which essentially requires that Florida employers secure workers' compensation coverage for their employees. The Respondent is a Florida corporation providing various tree services, including trimming and related activities. On June 11, 2007, the Petitioner issued a Stop-Work Order (07-172-D7) and an Order of Penalty Assessment based on the Respondent's failure to obtain proper workers' compensation insurance coverage for employees. On June 14, 2007, the Petitioner issued an Amended Order of Penalty Assessment for $147,419.52 against the Respondent. The amended order was personally served on the Respondent on the date of issuance. The Respondent did not challenge either the Stop-Work Order or the Amended Order of Penalty Assessment. On June 15, 2007, the Respondent executed a "Payment Agreement Schedule for Periodic Payment of Penalty" (hereinafter "Agreement"). The Agreement permitted the Respondent to satisfy the penalty through a ten percent down payment and 60 subsequent monthly payments. Based on the execution of the Agreement, the Petitioner lifted the Stop-Work Order on the condition that the Respondent complied with the terms of the Agreement. The Agreement specifically stated that failure to meet the terms set forth therein would "result in the immediate reinstatement of the Stop-Work Order, and the remaining unpaid balance of the penalty to be paid by the employer shall become immediately due." The Respondent was provided a copy of the Agreement and acknowledged understanding the terms set forth therein. The Respondent made the down payment required at the time the Agreement was executed, but thereafter made none of the monthly payments due under the Agreement. On May 18, 2007, the Petitioner issued an Order Reinstating Stop-Work Order (the "Reinstatement Order") based on the Respondent's failure to comply with the payment terms of the Agreement. The Reinstatement Order identified the unpaid balance as $132,674.52 and directed the Respondent to "cease all business operations in the State of Florida" until certain conditions were met. Such conditions included satisfaction of the existing unpaid penalty balance as well as any additional penalty related to business operations conducted in violation of the Stop-Work Order and a determination by the Petitioner that the Respondent was in compliance with workers' compensation coverage requirements. The Respondent did not challenge the Reinstatement Order, and it became effective on June 6, 2008. On December 14, 2009, a workers' compensation compliance investigator employed by the Petitioner observed tree service operations being conducted at a recreational vehicle park in Naples, Florida. The investigator observed that there were persons wearing t-shirts bearing the Respondent's identification. Upon inquiry by the investigator, the workers stated that they were working for the Respondent. The investigator observed that the vehicles from which the workers were operating bore the Respondent's insignia. The investigator determined that there was an existing Stop-Work Order against the Respondent. On January 8, 2010, the Petitioner issued a Request for Production of Business Records, seeking to identify the number of days during which the Respondent had operated in violation of the Stop-Work Order, and provided the request to the Respondent. Also on January 8, 2010, the Petitioner issued an Order Assessing Penalty for Working in Violation of Reinstated Stop-Work Order, seeking to impose a penalty of $555,000.00. The penalty calculation was based on the 555 calendar days from June 7, 2008, to December 14, 2009. The Respondent challenged the penalty assessment and requested a formal administrative hearing. On May 21, 2010, the Respondent submitted payroll records for the period of March 21, 2009, through December 11, 2009. The records established that the Respondent had conducted business operations during the period that the Stop- Work Order was effective. The records also indicated that the Respondent routinely conducted business operations from Monday through Friday of each week, but did not operate on Saturdays, Sundays, or usual legal holidays. On January 21, 2011, the Department issued an Amended Order Assessing Penalty for Working in Violation of Reinstated Stop-Work Order in the amount of $381,000.00, based on the Respondent's routine work schedule with the deletion of the Saturdays, Sundays, and legal holidays that had been included in the January 8, 2010, Assessment. On January 25, 2011, the Petitioner filed a Motion to Amend Order of Penalty Assessment. The Motion was granted without objection at the commencement of the hearing. All orders relevant to this dispute were hand- delivered or were mailed to the Respondent's corporate address, which was also the residential address for the principals of the Respondent.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Financial Services, Division of Workers' Compensation, enter a final order assessing a penalty of $381,000.00 against the Respondent for conducting business operations in violation of the reinstated Stop-Work Order. DONE AND ENTERED this 29th day of March, 2011, in Tallahassee, Leon County, Florida. S WILLIAM F. QUATTLEBAUM 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 29th day of March, 2011.
The Issue The issue in this case is whether the Stop-Work Order and Order of Penalty Assessment previously imposed against Yzaguirre Enterprises, Inc., was properly applied to Respondent as a successor-in-interest to Yzaguirre Enterprises, Inc.
Findings Of Fact Petitioner (also referred to herein as the "Department") is the state agency responsible for, inter alia, monitoring businesses within the state to ensure that such businesses are providing the requisite workers' compensation insurance coverage for all employees. The Department's headquarters are located in Tallahassee, Florida, but its investigators are spread throughout the state in order to more effectively monitor businesses. The Department is authorized to impose penalties against any businesses failing to maintain the proper insurance coverage for its employees. Workers' compensation coverage is required if a business entity has one or more employees and is engaged in the construction industry in Florida. Workers' compensation coverage may be secured via three non-mutually exclusive methods: 1) the purchase of a workers' compensation insurance policy; 2) arranging for the payment of wages and workers' compensation coverage through an employee leasing company; or 3) applying for and receiving a certificate of exemption from workers' compensation coverage, if certain statutorily-mandated criteria are met. Respondent is a sole proprietorship and is a duly- certified general contractor (License No. CGC1505393) in the State of Florida. Respondent was engaged in the work of carpentry on August 4, 2009. Carpentry has a construction industry classification code of 5654. Respondent's sole proprietorship is a successor-in- interest to a corporation known as Yzaguirre Enterprises, Inc. (YEI). Tammy Yzaguirre was the vice-president and a director of YEI. That corporation was administratively dissolved on September 25, 2009, for failure to file its annual report. YEI was primarily engaged in the business of carpentry. On October 13, 2008, the Department conducted an investigation of a job site in Immokalee, Florida, where YEI was engaged in work. During its investigation, the Department ascertained that several employees of YEI were not covered by a valid workers' compensation insurance policy, nor were those workers exempt from coverage. A Stop-Work Order was issued by the Department against YEI and posted on the work site. The Stop-Work Order, along with an Order of Penalty Assessment, was also given to Esequiel Yzaguirre (by hand- delivery) on November 12, 2008. Meanwhile, an Amended Order of Penalty Assessment was issued by the Department and sent to Respondent via certified mail. The Amended Order imposed a penalty in the amount of one hundred fifty-one thousand, seven hundred fifty-eight dollars and forty-six cents ($151,758.46). Neither the Stop-Work Order, nor the Amended Order of Penalty Assessment, was timely challenged by YEI. While Respondent did engage in some discussions and exchange of documents with the Department concerning the Amended Order of Penalty Assessment, she did not avail herself of the appeal rights stated in the Order. Respondent did not enter into a settlement agreement or payment plan with the Department, because she did not have any money to make payments. As of the date of the final hearing in this matter, the Stop-Work Order and Amended Order of Penalty Assessment had not been released. Instead of paying the amount set forth in the Amended Order of Penalty Assessment, Respondent formed a sole proprietorship in her name, obtained the necessary licenses and certifications to operate, and began to engage in the work of general construction again. Prior to commencing this work, Respondent obtained a workers' compensation insurance policy in an effort to satisfy all state requirements. Respondent did not intentionally attempt to break or circumvent any laws by the commencement of her new business. Respondent did not know that starting a new business in her name would be deemed improper by the Department. On August 4, 2009, the Department was engaged in a "sweep" in Immokalee, Florida. A sweep entails a large number of investigators working together in one place at one time for the purpose of determining whether employers in the area were complying with workers' compensation insurance requirements. During its sweep, a Department investigator noticed a YEI truck parked at a job site. The investigator took action to determine who was working out of the truck and obtained information about Respondent, i.e., that Respondent's new sole proprietorship may be engaged in on-going work at that site. Respondent argues that the truck was not being used by the new sole proprietorship. Rather, the truck had been loaned to some individuals who were working on their own or with other employers. Thus, claims Respondent, the Department should not be allowed to take any action against the sole proprietorship. There is no valid basis for Respondent's position. Upon further investigation, the Department ascertained that Respondent was operating under an entity that was deemed a successor-in-interest to YEI. That being the case, the Department issued its Order, which was served via hand-delivery to Respondent on August 5, 2009. At final hearing, Respondent attempted to object to the Department's findings relating to the initial Stop-Work Order from 2008. However, inasmuch as that Stop-Work Order was never formally challenged and became final by operation of law, the time for objections to it has passed. Thus, Respondent's testimony concerning whether or not all the workers listed in the Amended Order of Penalty Assessment were actually YEI's employees was not accepted.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by Petitioner, Department of Financial Services, Division of Workers' Compensation, affirming the Order Applying Stop-Work Order and Amended Order of Penalty Assessment to Successor Corporation or Business Entity. DONE AND ENTERED this 4th day of February, 2010, in Tallahassee, Leon County, Florida. R. BRUCE MCKIBBEN 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 February, 2010.
Findings Of Fact 11. The factual allegations in the Stop-Work Order and Order of Penalty Assessment issued on February 18, 2010, and the 2"! Amended Order of Penalty Assessment issued on August 5, 2011, which are fully incorporated herein by reference, are hereby adopted as the Department’s Findings of Fact in this case.
Conclusions THIS PROCEEDING came on for final agency action and Jeff Atwater, Chief Financial Officer of the State of Florida, or his designee, having considered the record in this case, including the Stop- Work Order and Order of Penalty Assessment and the 2" Amended Order of Penalty Assessment served in Division of Workers’ Compensation Case No. 10-053-D4 and being otherwise fully advised in the premises, hereby finds that: 1. On February 18, 2010, the Department of Financial Services, Division of Workers’ Compensation (hereinafter “Department”) issued a Stop-Work Order and Order of Penalty Assessment in Division of Workers’ Compensation Case No. 10-053-D4 to McDonnell Painting, d/b/a Painting and Wallcovering by McDonnell (McDonnell). The Stop-Work Order and Order of Penalty Assessment included a Notice of rights wherein McDonnell was advised that any request for an administrative proceeding to challenge or contest the Stop-Work Order and Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Stop-Work Order and Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 2. On March 3, 2010, the Stop- Work Order and Order of Penalty Assessment was served via certified mail on McDonnell. A copy of the Stop-Work Order and Order of Penalty Assessment is attached hereto as “Exhibit A” and incorporated herein by reference. 3. On February 19, 2010, the Department issued an Amended Order of Penalty Assessment to McDonnell in Case No. 10-053-D4. The Amended Order of Penalty Assessment assessed a total penalty of $10,058.88 against McDonnell. The Amended Order of Penalty Assessment included a Notice of Rights wherein McDonnell was advised that any request for an administrative proceeding to challenge or contest the Amended Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Amended Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes. 4. The Amended Order of Penalty Assessment was served on McDonnell by certified mail on February 25, 2010. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On March 15, 2010, McDonnell timely filed a Petition requesting a formal administrative hearing. The Petition failed to satisfy the requirements of Rule 28-106.2015(S), Florida Administrative Code, in that it did not contain a statement requesting an administrative hearing which identified those material facts in dispute, or in the alternative a statement that there were no disputed issues of material fact. As a result, on April 23, 2010, the Department issued an Order Dismissing Petition for Section 120.57(1), Florida Statutes, Hearing Without Prejudice, giving McDonnell 21 days to file a Petition that satisfied the requirements of Rule 28- 106.2015(5), Florida Administrative Code. 6. The Order Dismissing Petition for Section 120.57(1), Florida Statutes, Hearing Without Prejudice was served on McDonnell by certified mail on April 27, 2010. 7. On May 19, 2010, McDonnell timely filed an Amended Petition requesting an administrative hearing pursuant to Section 120.57(1), Florida Statutes. A copy of the Amended Petition is attached hereto as “Exhibit C” and incorporated herein by reference. The matter was referred to the Division of Administrative Hearings, where it was assigned Case No. 10-2788. 8. On January 10, 2011, the Department and McDonnell reached a negotiated settlement in which the Department agreed to issue a 2"! Amended Order of Penalty Assessment assessing a penalty in the amount of $2,379.00, and McDonnell agreed to pay the total penalty of $2,379 and to no longer contest the Stop- Work Order and Order of Penalty Assessment and gn Amended Order of Penalty Assessment. 9. On January 10, 2011, the Department filed a Notice of Settlement with the Division of Administrative Hearings, advising the Administrative Law Judge that the parties had resolved all issues pending in Case No. 10-2788. A copy of the Notice of Settlement is attached hereto as “Exhibit D.” 10. On January 10, 2011, Administrative Law Judge R. Bruce McKibben entered an Order Closing File, relinquishing jurisdiction to the Department. A copy of the Order Closing File is attached hereto as “Exhibit E.” 11. On August 5, 2011, the Department issued a 2"™ Amended Order of Penalty Assessment to McDonnell in Case No. 10-053-D4. The 2™ Amended Order of Penalty Assessment lowered the penalty assessed against McDonnell to $2,379.00 pursuant to the negotiated settlement. The 2"? Amended Order of Penalty was served on McDonnell by email on August 11,2011. A copy of the 2"! Amended Order of Penalty Assessment is attached hereto as “Exhibit F” and incorporated herein by reference.
The Issue The issues to be resolved in this proceeding concern whether the Petitioner was operating its restaurant business in violation of Chapter 440, Florida Statutes, the Florida Workers' Compensation Law, by failing to have required workers' compensation coverage. The related issues are whether the Department should therefore issue a Stop Work Order, whether a penalty should be imposed for so operating and what the correct penalty should be.
Findings Of Fact The Department is an Agency of the State of Florida charged with enforcing the statutory requirement, specifically Section 440.107, Florida Statutes, which mandates that employers in Florida secure the payment of workers' compensation insurance coverage for the benefit of employees. The Petitioner is a restaurant operating in the vicinity of Crystal River, Florida, which opened for business sometime in the year 2005. At certain times during its operation, which are those times relevant to this proceeding, the restaurant had four or more employees, and was thus subject to the requirement to secure payment of workers' compensation for those employees. Wanda Rivera is an investigator for the Division's Bureau of Compliance. On January 12, 2007, she was referred to investigate a restaurant in Crystal River, Florida. There was another restaurant nearby, the La Paz Mexican Grill, the Petitioner's business. Because she was in the area she made a routine visit to that restaurant as well. When Ms. Rivera entered the restaurant she saw two waitresses as well as another employee and the owner of the restaurant. She made a report of her visit as well as other events and observed facts from her investigation and included them as part of a narrative in her initial investigative report. Ms. Rivera checked the Department's Coverage and Compliance Automated System (CCAS) data base by first looking up the name La Paz Mexican Grill. She spoke to the restaurant's owner, Aswaldo Vazquez, and learned that the actual corporate name was 2 Friends, Inc. She researched that name in the Division's data base and found no indication of workers' compensation coverage for that corporation. She also interviewed workers present at the restaurant. Mr. Vazquez told Ms. Rivera that there were five employees and that the restaurant did not have workers' compensation coverage. Ms. Rivera also checked the CCAS data base, as well as the Department of State, Division of Corporation's data base. She thereby discovered that Mr. Vazquez was an officer of the corporation, but that he did not have an exemption from workers' compensation coverage which corporate officers may apply for and obtain. Ms. Rivera presented her investigative findings to her supervisor and after having done so issued a Stop Work Order, Number 07-012-D3, and served it upon Mr. Vazquez. She hand wrote the Stop Work Order Number on that form, having received that number from her supervisor. She served it on Mr. Vazquez personally on that same day, January 12, 2007. Part of her training as an investigator had emphasized serving documents personally on employers. The Stop Work Order was a three part form; she gave the yellow carbon copy of the Stop Work Order to Mr. Vazquez by hand delivery and, in checking her official file in the case in preparation for hearing, she found that her file contained no yellow copy of the Stop Work Order Form, corroborating her testimony that she had personally served the yellow copy of the Stop Work Order on Mr. Vazquez on January 12, 2007. The Stop Work Order specifically stated that all business operations had to cease immediately and could not resume until the Department issued an order releasing the Stop Work Order. The Order also stated that a penalty of $1,000.00 a day would be assessed the employer who conducted business operations in violation of the Stop Work Order. Ms. Rivera and Mr. Vazquez are fluent Spanish speakers. Ms. Rivera therefore conducted her interview with Mr. Vazquez in Spanish to assure that he understood all facets of the Division's position in his situation. She answered his questions and explained to him that the Stop Work Order was to take effect immediately and that there would be a $1,000.00 dollar per day fine for working in violation of the Stop Work Order. She also issued and served a Request for Production of Business Records for Penalty Assessment Calculation. The records were to be produced within five business days. Two types of records were requested: those that would show how much payroll the establishment had paid over the previous three years and those that would show exemptions. The request for records allows the employer five days to provide the documents; if no records were received within 15 days of the request, the Department could impute the gross payroll. Three weeks after serving the request on Mr. Vazquez, Ms. Rivera received some records by mail on February 2, 2007. They were insufficient for her investigation. Thus, not having received records from which she could calculate payroll and determine when the restaurant had four or more employees, Ms. Rivera, in accordance with statute, imputed the payroll and thereupon calculated a penalty of $34,240.30 based upon the imputed amount. She issued an Amended Order of Penalty Assessment to that effect on February 5, 2007, and it was served by certified mail on Mr. Vazquez on February 7, 2007. It was also served by a process server on February 13, 2007. That Amended Order of Penalty Assessment did not reference the Stop Work Order Number nor did it reflect the date it was issued. Ms. Rivera forgot to include this information when she filled out the Order. The Amended Order of Penalty Assessment did, however, have the following language: The Stop Work Order issued in this case shall remain in effect until either (a) the Division issues an order releasing the Stop Work Order upon finding that the employer has come into compliance with the coverage requirements of the workers' compensation law and pays the total penalty in full, or (b) the Division issues an Order of Conditional Release from Stop Work Order pursuant to the employer coming into compliance with the coverage requirements of the workers' compensation law and entering into a payment agreement schedule for periodic payment of penalty. On February 7, 2007, Mr. Vazquez phoned Ms. Rivera asking why his penalty was that high, stating that his accountant could provide additional records. Ms. Rivera had telephone contact at least twice with Mr. Vazquez between February 7, and March 29, 2007. When she contacted him at the restaurant, a voice would answer, "La Paz Mexican Restaurant, how may I help you?" She asked Mr. Vazquez if the restaurant was actually operating, and told him that he could not open for business while a Stop Work Order was in effect. She was assured that the restaurant was not working. Mr. Vazquez also told her that more records would be produced. On March 29, 2007, however, Ms. Rivera had not received any new records, so she visited the restaurant and found that it was open for business in violation of the Stop Work Order. Because the restaurant is open seven days a week, Ms. Rivera assessed an additional penalty of $1,000.00 per day since the Stop Work Order had been issued. She thus issued a Second Amended Order of Penalty Assessment for the sum of $110,240.30. The Second Amended Order of Penalty Assessment referred to Stop Work Order Number 07-012-D3, stating that the Stop Work Order had been filed on January 12, 2007, and noting that the Amended Order of Penalty Assessment was dated February 5, 2007, and the Order showed an issuance date of March 29, 2007. On the next day, March 30, 2007, Ms. Rivera received more business records, from which she could calculate a penalty without imputing the payroll. Ms. Rivera calculated the new penalty at $79,690.36. Before she could issue a new penalty order, however, Mr. Vazquez contacted her and said that his restaurant had been closed for several days while he was traveling. He subsequently provided documents to Ms. Rivera that showed that he was out of the country for nine days. While 76 days had elapsed between the date the Stop Work Order was issued and the date Ms. Rivera found the restaurant had been open, Ms. Rivera determined that she would assess the penalty for only 67 days of that period. This decision was based upon Mr. Vazquez's documentation and her giving him the benefit of the doubt in accepting his representation that he had been out of the country for nine days and not operating. She then re-calculated the penalty as being $70,060.36 and issued a Third Amended Order of Penalty Assessment to that effect. The Third Amended Order of Penalty Assessment made reference to Stop Work Order Number 07-012-D3, and notes that the Stop Work Order was issued on January 12, 2007. The Third Amended Order has "February 5, 2007," in the line on the order for "issuance date." The entry for "issuance date" on the Third Amended Order of Penalty Assessment is incorrect and it should have been April 3, 2007, the date the Amended Order of Penalty Assessment was issued. The penalty worksheet for the Third Amended Order of Penalty Assessment shows that there was $25,793.55 in payroll for the relevant portions of 2005; $8,635.30 for relevant portions of 2006 during which times the restaurant had four employees. There was $1,370.21 in payroll for the relevant first 12 days of 2007, which was up until the time the Stop Work Order was issued. Ms. Rivera did not include the payroll for periods of time when the record showed the restaurant did not have four employees and her work papers so reflect. The payroll was calculated from 2005 forward because the business opened that year. On April 4, 2007, Mr. Vazquez brought his restaurant into compliance by reducing his staff to less than four employees and he entered into an agreement with the Department whereby he would pay down 10 percent of the penalty and agree to pay the remainder in 60 interest free monthly payments. Mr. Vazquez, in effect, does not contest the Division's position that he was required to carry workers' compensation coverage during the pertinent time periods and that he did not have such coverage. In actuality he disputes the amount of the penalty because he maintains that he did not receive the Stop Work Order until March 29, 2007. Mr. Vazquez is the president of the 2 Friends, Inc., Corporation. He speaks English and opined during his testimony that he reads 60 to 70 percent of English text. He knows people who are fluent in English and has people to whom he can show documents written in English if he does not understand any part of such.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore, RECOMMENDED that a final order be entered by the Department of Financial Services finding that the Petitioner, 2 Friends Inc., d/b/a/ La Paz Mexican Grill, has failed to secure required workers' compensation coverage for its employees in violation of Sections 440.10(1)(a) and 440.38(1), Florida Statutes (2007), and that a penalty against that entity be accessed in the amount of $70,060.36, and that said final order provide for an acceptable installment payment arrangement whereby the amount may be paid over a period of at least 60 months at no interest. DONE AND ENTERED this 30th day of July, 2008, in Tallahassee, Leon County, Florida. S P. MICHAEL RUFF 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 Clerk of the Division of Administrative Hearings this 30th day of July, 2008. COPIES FURNISHED: Leon M. Boyajan, II, Esquire Leon M. Boyajan, II, P.A. 2303 West Highway 44 Inverness, Florida 34453-3809 Thomas H. Duffy, Esquire Department of Financial Services 200 East Gaines Street, 6th Floor Tallahassee, Florida 32399 Honorable Alex Sinks Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Daniel Sumner, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
Findings Of Fact 9. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on February 8, 2011, and the Amended Order of Penalty Assessment issued on Februrary 23, 2011, attached as “Exhibit A” and “Exhibit B” respectively, and fully incorporated herein by reference, are hereby adopted as the Department’s Findings of Fact in this case,
Conclusions THIS PROCEEDING came on for final agency action and Jeff Atwater, Chief Financial Officer of the State of Florida, or his designee, having considered the record in this case, including the request for administrative hearing received from CARLOS ALBERTO RODRIGUEZ, the Stop-Work Order and Order of Penalty Assessment, and the Amended Order of Penalty Assessment, and being otherwise fully advised in the premises, hereby finds that: 1. On February 8, 2011, the Department of Financial Services, Division of Workers’ Compensation (hereinafter “Department”) issued a Stop-Work Order and Order of Penalty Assessment in Division of Workers’ Compensation Case No. 11-047-D5 to CARLOS ALBERTO RODRIGUEZ. The Stop-Work Order and Order of Penalty Assessment included a Notice of Rights wherein CARLOS ALBERTO RODRIGUEZ was advised that any request for an administrative proceeding to challenge or contest the Stop-Work Order and Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Stop-Work Order and Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes, and must conform to Rule 28-106.2015, Florida Administrative Code. 2. On February 8, 2011, the Stop-Work Order and Order of Penalty Assessment was served by personal service on CARLOS ALBERTO RODRIGUEZ. A copy of the Stop-Work Order and Order of Penalty Assessment is attached hereto as “Exhibit A” and incorporated herein by reference. 3. On February 23, 2011, the Department issued an Amended Order of Penalty Assessment to CARLOS ALBERTO RODRIGUEZ. The Amended Order of Penalty Assessment assessed a total penalty of $163,791.63 against CARLOS ALBERTO RODRIGUEZ. The Amended Order of Penalty Assessment included a Notice of Rights wherein CARLOS ALBERTO RODRIGUEZ was advised that any request for an administrative proceeding to challenge or contest the Amended Order of Penalty Assessment must be filed within twenty-one (21) days of receipt of the Amended Order of Penalty Assessment in accordance with Sections 120.569 and 120.57, Florida Statutes, and must conform to Rule 28-106.2015, Florida Administrative Code. 4. On March 7, 2011, the Amended Order of Penalty Assessment was served by personal service on CARLOS ALBERTO RODRIGUEZ. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On February 28, 2011, CARLOS ALBERTO RODRIGUEZ timely filed a request for administrative hearing with the Department. The petition for administrative review was forwarded to the Division of Administrative Hearings on March 28, 2011, and the matter was assigned DOAH Case No. 11-1574. A copy of the petition is attached hereto as “Exhibit C” and incorporated herein by reference. 6. On May 9, 2011, the Department served by U.S. mail its First Interlocking Discovery Request (‘discovery requests”) which included requests for admissions, interrogatories, and requests for production on Respondent. Respondent was required to serve its answers upon the Department within 30 days pursuant to Rules 1.340(a), 1.350(b), and 1.370(a), Florida Rules of Civil Procedure. However, pursuant to Rule 128-106.103, Florida Administrative Code, “five days shall be added to the time limits when service has been made by regular U.S. mail.” Therefore, Respondent was required to respond to the discovery on or before June 13, 2011. 7. On June 22, 2011, the Department filed a Motion to Deem Matters Admitted and Relinquish Jurisdiction Pursuant to Section 120.57(1)(i), Florida Statutes after having not received any answer from Respondent to the Department’s discovery requests. 8. On June 23, 2011, the Administrative Law Judge issued an Order Relinquishing Jurisdiction and Closing File. A copy of the Order Relinquishing Jurisdiction and Closing File is attached hereto as “Exhibit D” and incorporated herein by reference.
Findings Of Fact 13. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on February 11, 2009, the Amended Order of Penalty Assessment issued on March 5, 2009, the 2"4 Amended Order of Penalty Assessment issued on March 11, 2009 and the 3 Amended Order of Penalty Assessment issued on October 30, 2009, which are fully incorporated herein by reference, are hereby adopted as the Department’s Findings of Fact in this case.
Conclusions THIS PROCEEDING came on for final agency action and Alex Sink, Chief F inancial Officer of the State of Florida, or her designee, having considered the record in this case, including the Stop- Work Order and Order of Penalty Assessment and the Amended Orders of Penalty Assessment served in Division of Workers’ Compensation Case No. 09-036-D1, and being otherwise fully advised in the premises, hereby finds that: 1. On February 11, 2009, the Department of Financial Services, Division of Workers’ Compensation (hereinafter “Department”) issued a Stop-Work Order and Order of Penalty Assessment in Division of Workers’ Compensation Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. 2. On February 11, 2009, the Stop-Work Order and Order of Penalty Assessment was served by personal service on BEST WELDING AND FABRICATION, INC. A copy of the Stop-Work Order and Order of Penalty Assessment is attached hereto as “Exhibit A” and incorporated herein by reference. 3. On March 5, 2009, the Department issued an Amended Order of Penalty Assessment in Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. The Amended Order of Penalty Assessment assessed a total penalty of $196,980.30 against BEST WELDING AND FABRICATION, INC. 4. On March 16, 2009, the Amended Order of Penalty Assessment was served by certified mail on BEST WELDING AND FABRICATION, INC. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 5. On March 11, 2009, the Department issued a 2°4 Amended Order of Penalty Assessment in Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. The an Amended Order of Penalty Assessment assessed a total penalty of $50,968.94 against BEST WELDING AND FABRICATION, INC. . 6. On March 26, 2009, the 2°4 Amended Order of Penalty Assessment was served by certified mail on BEST WELDING AND FABRICATION, INC. A copy of the 2"! Amended Order of Penalty Assessment is attached hereto as “Exhibit C” and incorporated herein by reference. 7. The Employer requested a formal hearing on April 6, 2009. A copy of the Request for Hearing is attached hereto as “Exhibit D” and incorporated herein by reference. 8. On April 21, 2009, the request for formal hearing was forwarded to the Division of Administrative Hearings for assignment of an Administrative Law Judge. The matter was assigned to Administrative Law Judge Barbara Staros and given case number 09-2138. 9. On October 30, 2009, the Department issued a 3rd Amended Order of Penalty Assessment in Case No. 09-036-D1 to BEST WELDING AND FABRICATION, INC. The 3rd Amended Order of Penalty Assessment assessed a total penalty of $10,179.61 against BEST WELDING AND FABRICATION, INC. 10. On October 30, 2009, the 3™ Amended Order of Penalty Assessment was served on legal counsel for BEST WELDING AND FABRICATION, INC. A copy of the 3" Amended Order of Penalty Assessment is attached hereto as “Exhibit E” and incorporated herein by reference. 11. On November 9, 2009, BEST WELDING AND FABRICATION, INC. filed a Notice of Voluntary Dismissal. A copy of the Notice of Voluntary Dismissal is attached hereto as “Exhibit F” and incorporated herein by reference. 12. On November 12, 2009, an Order Closing File was entered. The Order Closing File relinquished jurisdiction to the Department. A copy of the Order Closing File is attached hereto as “Exhibit G” and incorporated herein by reference.
Conclusions WHEREFORE, it is ORDERED and ADJUDGED, that the Department rejects all bids for Invitation to Negotiate 2011-38, and the Formal Written Protest and Petition for Administrative Hearing is dismissed. DONE AND ORDERED this 1g day of January, 2012, in Tallahassee, Florida. COPIES FURNISHED TO: Cynthia S. Tunnicliff Brian A. Newman Pennington, Moore, Wilkinson, Bell & Dunbar, P.A. 215 South Monroe Street, 2"? Floor Tallahassee, Florida 32303 (850) 222-3533 Clerk Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399 Commissioner of Education Donna E. Blanton Lisa Caroline Scoles Radey, Thomas, Yon, and Clark 301 South Bronough Street, Suite 200 Tallahassee, Florida 32301 (850) 245-6654 James H. Peterson, Ill Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-3060 NOTICE OF RIGHTS a Any party to this’ proceeding has the right:to seek judicial review of this Order under Section 120.68, Florida Statutes, by the filing of a notice of appeal under Rules 9.110 and 9.190, Florida Rules of Appellate Procedure, with the Agency Clerk and by filing a copy of the notice of appeal accompanied by the applicable filing fees with the appropriate district court of appeal. The notice of appeal must be filed within thirty days after this order is filed with the clerk of the Department. Failure to make a timely appeal will result in waiver of the right of judicial review in this matter. CERTIFICATE OF THE AGENCY CLERK | HEREBY CERTIFY that a copy has been furnished via U.S. Mail to the below, this __( g day of January, 2012. Cynthia S. Tunnicliff Donna E. Blanton Brian A. Newman Lisa Caroline Scoles Pennington, Moore, Wilkinson, Bell & Radey, Thomas, Yon, and Clark Dunbar, P.A. 301 South Bronough Street, Suite 200 215 South Monroe Street, 2"¢ Floor Tallahassee, Florida 32301 Tallahassee, Florida 32303 (850) 245-6654 (850) 222-3533 | : LYNN ABBOTT Agency Clerk
Findings Of Fact 15. The factual allegations contained in the Stop-Work Order and Order of Penalty Assessment issued on November 18, 2008, the Amended Order of Penalty Assessment issued on January 16, 2009, and the 2™4 Amended Order of Penalty Assessment issued on May 21, 2009 which are fully incorporated herein by reference, are hereby adopted as the Department’s Findings of Fact in this case.
Conclusions THIS PROCEEDING came on for final agency action and Alex Sink, Chief Financial Officer of the State of Florida, or her designee, having considered the record in this case, including the Stop-Work Order and Order of Penalty Assessment and the Amended Orders of Penalty Assessment served in Division of Workers’ Compensation Case No. 08-385-1A, and being otherwise fully advised in the premises, hereby finds that: 1. On November 18, 2008, the Department of Financial Services, Division of Workers’ Compensation (hereinafter “Department”) issued a Stop-Work Order and Order of Penalty Assessment in Division of Workers’ Compensation Case No. 08-385-1A to M & M Roofing, LLC. 2. On December 8, 2008, the Stop-Work Order and Order of Penalty Assessment was served by personal service on M & M Roofing, LLC. A copy of the Stop-Work Order and Order of Penalty Assessment is attached hereto as “Exhibit A” and incorporated herein by reference. 3. On January 16, 2009, the Department issued an Amended Order of Penalty Assessment in Case No. 08-385-1A to M & M Roofing, LLC which assessed a total penalty of $153,187.40 against M & M Roofing, LLC. A copy of the Amended Order of Penalty Assessment is attached hereto as “Exhibit B” and incorporated herein by reference. 4. On May 21, 2009, the Department issued a 2°4 Amended Order of Penalty Assessment in Case No. 08-385-1A to M & M-Roofing, LLC which assessed a total penalty of $153,556.44 against M & M Roofing, LLC. A copy of the 2° Amended Order of Penalty Assessment is attached hereto as “Exhibit C” and incorporated herein by reference. 5. The Employer timely requested a Formal Hearing on or about February 27, 2009. A copy. of the Request for Hearing is attached hereto as “Exhibit D” and incorporated herein by reference. 6. On March 23, 2009, the request for formal hearing was forwarded to the Division of Administrative Hearings for assignment of an administrative law judge for a formal hearing. The matter was assigned to Judge Cleavinger and assigned case number 09-1578. 7. A formal hearing was scheduled for May 27, 2009, in Pensacola, Florida. A copy of the Notice of Hearing is attached hereto as “Exhibit E”. 8. A Motion to Continue Hearing was filed by the Department on April 30, 2009. 9. An Amended Motion to Continue Hearing was filed by the Department on May 5, 2009. The motion stated that Petitioner had been contacted and did not oppose the Motion. 10. An Order Granting Continuance and Re-Scheduling Hearing was entered on May 18, 2009. The hearing was re-scheduled for June 30, 2009, in Pensacola, Florida. A copy of the Order Granting Continuance and Re-Scheduling Hearing is attached as “Exhibit F”. 11.. A Letter of Request for Continuance was filed by M & M Roofing, LLC on June 22, 2009. 12. The Request for Continuance was denied on June 23, 2009. The Order Denying Continuance of Final Hearing is attached as “Exhibit G”. 13. A final hearing was held on June 30, 2009. M & M Roofing, LLC failed to appear at the hearing. 14. An Order Relinquishing Jurisdiction and Closing File was entered on July 2, 2009. A copy of the Order Relinquishing Jurisdiction and Closing File is attached as “Exhibit H”. |
The Issue The issue is whether the Department of Financial Services properly assessed a penalty on Petitioner for working in violation of a reinstated Stop-Work Order.
Findings Of Fact The Division is charged with the regulation of workers' compensation insurance in the State of Florida. Petitioner, Extraordinaire Home Improvements, Inc. (Extraordinaire Homes), is a corporation located in Jacksonville, Florida, and is engaged in the business of building construction, primarily roofing. Charlie Sakakini is the owner of Extraordinaire Homes. On October 20, 2004, the Division issued a Stop-Work Order and Order of Penalty Assessment. On October 29, 2004, the Department issued an Amended Order of Penalty Assessment to Petitioner in the amount of $8,079.29. Also on October 29, 2004, the parties entered into a Payment Agreement Schedule for Periodic Payment of Penalty wherein Mr. Sakakini agreed to remit monthly payments on behalf of Extraordinaire Homes to the Division in the amount of $589.95 for 11 months. The payment schedule informed Petitioner that failure to comply with the terms of the agreement would result in the immediate reinstatement of the Stop-Work Order. The Division issued an Order of Conditional Release from Stop-Work Order the same day the agreement was signed. Petitioner, through its owner, Mr. Sakakini, failed to make the payments required by the agreed payment schedule. Accordingly, the Division issued an Order Reinstating Stop-Work Order (Reinstatement Order) on July 27, 2006. The Reinstatement Order informed Petitioner that it must cease all business operations in the State of Florida until an order releasing the Reinstatement Order was issued. Mr. Sakakini acknowledges that Petitioner was actively conducting business operations, i.e., roofing work, on 100 days in the Fall of 2007, despite the Reinstatement Order having been issued. On September 28, 2007, the Division issued an Order Assessing Penalty for Working in Violation of Reinstated Stop-Work Order assessing a penalty of $406,000.00. The amount of the assessed penalty was reduced to $100,000.00 in a Second Amended Order of Penalty Assessment as a result of an Order Granting Motion to Amend Order of Penalty Assessment entered by the undersigned on April 28, 2008. Of the 100 days worked during the pendency of the Reinstatement Order, 25 of those days involved work on Mr. Sakikini's personal residence. During this time, business was slow, and he was trying to give his workers "something to do so that they can make some money." Mr. Sakikini continues to live in the home where this work took place. Mr. Sakikini paid the workers who worked on his personal residence with checks from the business account of Extraordinaire Homes. Mr. Sakikini considers the amount of the penalty, i.e., $1,000.00 per day of violation, to be excessively harsh when applied to a small businessman like himself.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED that Respondent, Department of Financial Services, Division of Workers' Compensation, enter a final order amending the Second Amended Order of Penalty Assessment, assigning a penalty of $75,000.00. DONE AND ENTERED this 27th day of June, 2008, in Tallahassee, Leon County, Florida. S BARBARA J. STAROS 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 27th day of June, 2008.
