Findings Of Fact The Parties. Petitioner, Sheraton Associates of Orange Park, Ltd. (hereinafter referred to as "Sheraton Associates"), was formed as a Florida limited partnership on November 15, 1973. It was formed to own a motel in Orange Park, Florida. The business address of Sheraton Associates is Post Office Box 724848, Atlanta, Georgia 31139 At all times relevant to this proceeding, Philip A. Browning, Jr., was the general partner of Sheraton Associates. Respondent, the Department of Revenue (hereinafter referred to as the "Department"), is an agency of the State of Florida charged with responsibility for, among other things, the assessment and collection Florida sales and use tax. Chapter 212, Florida Statutes. The following information was stipulated to be correct by the parties: Sheraton Associates' employer identification number: 58-1178445; DTA Number: 9201194; c. Audit Number: 9021109195 Audit Period: 7/1/87 - 2/13/91; Proposed Assessment and Sustained Amount: $69,142.65; Local Government Infrastructure-Surtax Audit Period: 2/1/90 - 2/13/91 Proposed Assessment and Sustained Amount: $1,976.30; Amount Contested: Sales Tax $69,142.54 Surtax $ 1,976.30 The Operation of Sheraton Associates. From 1974 until February 13, 1991, Sheraton Associates owned a Best Western Motel (hereinafter referred to as the "Motel"), located in Orange Park, Florida. The Motel (land and building) was the sole asset of Sheraton Associates. The purchase of the land and building for the Motel was financed through Freedom Federal Savings and Loan of Tampa, Florida. Sheraton Associates executed a Promissory Note and a Mortgage securing the payment of the note to Freedom Federal Savings and Loan. Sheraton Associates entered into a management agreement with Orange Park Associates, Inc. (hereinafter referred to as "Orange Park Associates"). Pursuant to the agreement, Orange Park Associates operated the Motel, including the restaurant and lounge, owned by Sheraton Associates. Philip Browning, Jr., was the president and a director of Orange Park Associates. Mr. Browning was also the general partner of Sheraton Associates. Mr. Browning executed and delivered to Freedom Federal Savings and Loan as further security for the Promissory Note from Sheraton Associates a Collateral Assignment of Rents and Leases, an Assignment of Contracts, Licenses, Permits, Trade Names and Documents and a Security Agreement for all other tangible and intangible personal property. Orange Park Associates operated the Motel on behalf of Sheraton Associates for over sixteen years. The manager of the Motel was Greg Kaylor. The Resolution Trust Corporation's Takeover of the Motel Property. The Resolution Trust Corporation (hereinafter referred to as the "RTC"), took over all of the assets of Freedom Federal Savings and Loan as receiver in late 1989 or early 1990. Sheraton Associates defaulted on the Promissory Note to Freedom Federal Savings and Loan. The RTC, therefore, commenced foreclosure on the property of Sheraton Associates. A Notice of Lis Pendens seeking foreclosure on the mortgage on the Motel property formerly held by Freedom Federal Savings and Loan was issued by the RTC on or about July 16, 1990. A Final Judgment of Foreclosure was entered in the Circuit Court, Fourth Judicial Circuit, in and for Clay County, Florida, on or about December 7, 1990. On or about February 13, 1991, the RTC took title to the Motel property pursuant to foreclosure. The RTC continued to operate the Motel through an entity known as Real Estate Recovery. Real Estate Recovery in turn operated the Motel through an entity known as Tecton. Mr. Kaylor was hired by Tecton. As of February 14, 1991, Mr. Kaylor became manager of the Motel on behalf of Tecton. The Department's Audit. On or about March 12, 1991, James Estey informed Mr. Kaylor that the Department intended to conduct an audit of the operation of the Motel. The originally planned audit period was modified to reflect the transfer of the assets of Sheraton Associates by Mr. Estey. The modified audit period was July 1, 1987 through February 13, 1991. Although Mr. Kaylor was employed by Tecton after February 13, 1991, Mr. Kaylor continued to act on behalf of Sheraton Associates with the Department. Mr. Kaylor made the records of the Motel available to Mr. Estey, acted as the contact person for Sheraton Associates with Mr. Estey and kept Philip Browning informed about the progress of the audit. During Mr. Estey's first conversation with Mr. Kaylor, Mr. Estey was informed that the RTC was the owner of the Motel property. Mr. Kaylor told Mr. Estey that the RTC had taken over the property by "foreclosure." Mr. Estey did not know what the RTC was. Nor did Mr. Estey understand the RTC's connection with the Federal government. Mr. Estey assumed that the RTC was simply a corporate business entity. The evidence failed to prove that Mr. Kaylor told Mr. Estey that Sheraton Associates had declared "bankruptcy." The Department, however, because of Mr. Estey's lack of understanding of the RTC, believed that a transfer of the assets of Sheraton Associates had been transferred pursuant to a bankruptcy sale. The audit of Sheraton Associates commenced in May of 1991. On or about August 30, 1991, Mr. Estey presented his audit findings to Mr. Kaylor by Notice of Intent to Make Sales and Use Tax Audit Changes. Mr. Estey had determined that Sheraton Associates owed additional sales tax, plus penalties and interest, for the audit period of $71,118.00 When informed that there was additional tax due for the audit period, Mr. Kaylor inquired of Mr. Estey as to whether Sheraton Associates was liable for the tax. Mr. Estey still believed that the RTC was just another corporation and that the RTC had "acquired" the Motel property through bankruptcy. Therefore, Mr. Estey informed Mr. Kaylor that the RTC would be liable for the sales tax deficiency absent an agreement between Sheraton Associates and the RTC to the contrary. Mr. Kaylor informed Philip Browning of Mr. Estey's representations. Philip Browning directed Mr. Kaylor to get the representation in writing from Mr. Estey. Mr. Kaylor, therefore, requested that Mr. Estey confirm his representations in writing concerning the liability of the RTC. On September 4, 1991, Mr. Estey wrote, in part, the following to Mr. Kaylor: * * * I checked with my supervisor, Mr. Perry Brown, that DOR has no way of finding out if a private agreement between Mr. Browning and the RTC exists regarding tax liability. My supervisor's position is that if an agreement does not exist, then the liability for the taxes due falls on the RTC per Florida law since RTC acquired the business and is running it. You may want to call Perry Browning for further clarification on this particular issue. He may be reached at 359-6077 also. Joint Exhibit 1. Mr. Kaylor confirmed Mr. Estey's representations in the September 4, 1991 letter by speaking by telephone with Mr. Estey's immediate supervisor, Perry Brown. Perry Brown confirmed the representations of the letter. Based upon Mr. Estey's letter of September 4, 1991, Sheraton Associates took no immediate action to contest the sales tax deficiency alleged in the August 30, 1991 Notice of Intent. Information concerning the results of the audit were went to Philip Browning. Despite having been told that the RTC was liable for the sales tax deficiency, on or about September 27, 1991, Alan Vaughn, Sheraton Associates' accountant, requested an extension of time to challenge the findings of the August 30, 1991 Notice of Intent. That request was granted and Sheraton Associates was given until October 30, 1991, to respond to the Notice of Intent. The Department's Change in Position. In October of 1991 Mr. Estey telephoned Real Estate Recovery's or Tecton's offices. For the first time, Mr. Estey realized that the RTC was not a corporate business and that it was an agency of the Federal government. Mr. Estey informed his supervisor, Perry Brown, who also was not aware of what the RTC was, of his discovery concerning the RTC. Perry Brown then wrote Mr. Vaughn on or about November 7, 1991 and informed him of the following: Jim Estey contacted a representative of the Resolution Trust Corporation and he is of the opinion that Sheraton [sic] Associates of Orange Park would be liable for the tax due on this audit. I would agree with this as the tax was or should have been collected by them. They took over the operation in lieu of foreclosure and did not purchase the business. I am extending the due date of the Notice of Intent to make Audit changes until December 6, 1991. [Emphasis added]. * * * Sheraton Associates' Protest. By letter dated December 5, 1991, Sheraton Associates timely protested the Department's determination of a sales tax deficiency. Sheraton Associates contended that any tax deficiency was payable by the RTC and not Sheraton Associates. Sheraton Associates did not challenge the accuracy of the alleged sales tax deficiency in it's protest of December 5, 1991, or at any subsequent time. On November 30, 1992, the Department issued a Notice of Decision sustaining the assessment. On December 30, 1992, Sheraton Associates filed a Petition for Reconsideration of Notice of Decision. On April 13, 1993, the Department issued a Notice of Reconsideration sustaining the assessment. Sheraton Associates' Detriment. The evidence in this case failed to prove that Sheraton Associates relied upon the Department's initial representation that the RTC was liable for the sales tax deficiency at issue in this proceeding to its detriment. On August 30, 1991, Sheraton Associates was first informed by Notice of Intent to Make Sales and Use Tax Audit Changes that Sheraton Associates was liable for additional sales and use tax. Sheraton Associates was informed that it could challenge this determination. While the Department erroneously informed Sheraton Associates on September 4, 1991, that RTC was liable for the tax, Mr. Vaughn, Sheraton Associates' accountant, was aware that the matter was not final because of the outstanding August 30, 1991 Notice of Intent. Therefore, on September 27, 1991, Mr. Vaughn requested an extension of time in which to respond to the August 30, 1991 Notice. The time within which to file a challenge to the Department's Notice of Sheraton Associate's liability was extended until October 30, 1991. No effort was made by Sheraton Associates to challenge the outstanding Notice of Intent, and it was not reasonable for Sheraton Associates to ignore that Notice of Intent based upon a hand written letter from the Department's auditor. 38 The Department reversed the position asserted in the September 4, 1991 letter from Mr. Estey on or about November 7, 1991. When informed of the change in the Department's position, Sheraton Associates was given until December 6, 1991 to protest the Notice of Intent. This extension eliminated any possible detriment to Sheraton Associates of the original representation from Mr. Estey by giving Sheraton Associates an opportunity to do what it could have done when first informed on August 30, 1991, that there was a sales tax deficiency: challenge the Department's findings. Sheraton Associates in fact did so. In support of its position that it suffered a detriment as a result of Mr. Estey's letter, Sheraton Associates has asserted that it did not assess the audit findings when they were first presented. The evidence failed to prove that Sheraton Associates was prejudiced by not acting immediately or that its actions in not protesting immediately were reasonable in light of the fact that the Notice of Intent had not been withdrawn or modified by the Department. Sheraton Associates has also asserted that its failure to retain its records, which in turn makes it difficult to contest the Department's audit findings, is part of its detrimental reliance. The evidence failed to prove, however, when Sheraton Associates disposed of its records. In light of the fact that the Notice of Intent issued on August 30, 1991, was not withdrawn or modified by the Department to reflect the position asserted by Mr. Estey's September 4, 1991 letter, it was not reasonable for Sheraton Associates to dispose of the records. Finally, Sheraton Associates assertion that it failed to pursue the RTC was caused by Mr. Estey's letter. Again, it was unreasonable for Sheraton Associates to rely on Mr. Estey's letter and not pursue the RTC while the Notice of Intent remained outstanding.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by the Department of Revenue sustaining its August 30, 1991 assessment of additional sales tax, plus penalties and interest, and local government infrastructure surtax, plus penalties and interest. DONE AND ENTERED this 3rd day of March, 1995, in Tallahassee Florida. LARRY J. SARTIN 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 3rd day of March, 1995. APPENDIX The parties have 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. Sheraton Associates' Proposed Findings of Fact Accepted in 1. Accepted in 2 and hereby accepted. Accepted in 4. Accepted in 35. Accepted in 1. Accepted in 7. Accepted in 9-10 and 12-13. Accepted in 13. Accepted in 13 and 15. Accepted in 22. Accepted in 33. Accepted in 34. Accepted in 35. Hereby accepted. Accepted in 25. Hereby accepted. Not supported by the weight of the evidence. See 18-20. Accepted in 26. Not supported by the weight of the evidence. See 36-41. Not relevant. Not supported by the weight of the evidence. The Department's Proposed Findings of Fact Accepted in 1. Accepted in 3 and hereby accepted. Accepted in 4. Accepted in 35. Accepted in 1. Accepted in 7. Accepted in 9-10 and 12-13. Accepted in 13. Accepted in 13 and 15. Accepted in 22. Accepted in 33. Accepted in 34. Accepted in 35. Hereby accepted. Accepted in 5. Accepted in 7. Accepted in 2. Accepted in 8-9. Accepted in 15-16. 20 See 18-20. Accepted in 21. Accepted in 22 and hereby accepted. Hereby accepted. Accepted in 22-23. Accepted in 23. Accepted in 19-20. Accepted in 24. Accepted in 25. Accepted in 28. Cumulative. Not relevant. Accepted in 29. Accepted in 30 Accepted in 31. Accepted in 32. 35-36 Hereby accepted. Accepted in 6. Accepted in 8. Accepted in 11. Accepted in 10-13. Hereby accepted. Accepted in 9. COPIES FURNISHED: Donna Houghton Thames, Esquire Thomas W Brown, Esquire Post Office Box 1029 Lake City, Florida 32056-1029 Olivia P. Klein Assistant Attorney General Jarrell L. Murchison Assistant Attorney General Tax Section, Capitol Building Department of Legal Affairs Tallahassee, Florida 32399-1050 Larry Fuchs Executive Director 104 Carlton Building Tallahassee, Florida 32399-0100 Linda Lettera General Counsel 204 Carlton Building Tallahassee, Florida 32399-0100
The Issue Whether Cindy Cammarota and Quail Oaks Apartments violated the Hillsborough County Human Rights Ordinance (Ord. 88-9 as amended) by discriminating on grounds of race and religion against Petitioners, Reverends William and Jacqueline Caractor with respect to an attempted eviction action.
Findings Of Fact Respondent Cammarota is the resident manager of Quail Oak Apartments. Respondent Quail Oak is an apartment complex in Hillsborough County which is subject to the Hillsborough County Human Rights Ordinance. Petitioners, who are black, are husband and wife. They are ordained ministers, who reside in Quail Oaks. They have used the community center at the apartment complex for services and frequently pray with other residents. They wear clerical garb and read their Bible in common areas at the complex. At all times material to these proceedings, Respondent Cammarota knew Petitioners were ministers at Mt. Carmel African Methodist Espiscopal Church. On July 30, 1990, a written rental agreement was entered into between Quail Oaks, lessor, and Petitioners, lessees, for an apartment at the complex. The term of the lease was from September 1, 1990 through August 31, 1991. At the option of Quail Oaks, payment of rent could be accepted conditionally by means of a personal check from the lessees. If the check was rejected for insufficient funds, Quail Oaks could require rent plus late charges to be paid by cashier's check, certified check or money order. In addition, Quail Oaks could terminate the lease for nonpayment of rent. Prior to leaving for vacation in November 1990, Petitioner Jacqueline Caractor issued a check in the amount of $645.00 for the November rent. The check was drawn upon the personal checking account belonging to her and her husband at Citizens and Southern National Bank (C & S). It was payable upon demand to Quail Oaks. Although a C & S counter check was used, all of the information on the check was correct. This check was accepted by Respondent Cammarota on behalf of Quail Oaks. It was presented to Barnett Bank of Tampa (Barnett) for collection and the bank was instructed to deposit the funds in Quail Oaks' account at the bank. Barnett Bank did not exercise ordinary care in regard to the check as required by the Uniform Commercial Code. Instead of collecting the funds from the payor bank, Barnett returned the check unpaid to Quail Oaks on November 5, 1990. Notice of the bank's dishonor was sent to Quail Oaks in a notice of debit with respect to the instrument together with the check itself. No reason was given by the bank for the dishonor. The provisional settlement of the check made by Barnett with Quail Oaks was revoked and the amount of credit given was charged back to Quail Oaks' account. Respondent Cammarota, who managed the Quail Oaks account with Barnett, misinterpreted this activity in the account as nonpayment of rent. A "three day notice" was issued by Quail Oaks to Petitioners for payment of rent or possession of the premises on November 7, 1990. The deadline for payment was November 13, 1990. Petitioners received actual notice on November 16, 1990, when they returned from vacation and found the notice posted on the front door of their apartment. A message concerning the matter was also on their answering machine. The message advised them that their check had been returned for insufficient funds. Petitioners went to their bank to determine why their check had not been honored. They had always paid their rent on time and they were concerned about the current state of affairs. The C & S Bank investigated the matter and discovered the check had never been submitted to it for payment. While Petitioners were present, a representative of the bank telephoned Respondent Cammarota and told her a bank error must have occurred as sufficient funds had always been available in Petitioners' account to cover the check, which had never been submitted to C & S for collection. Once Petitioners established that insufficient funds was not the basis for a dishonor of their personal check, they went to Respondent Cammarota to discuss the resolution of the problem. Respondent Cammarota was asked to resubmit the personal check for payment. She refused and requested a money order that included additional charges for the costs Quail Oaks incurred as a result of Barnett Bank's dishonor of the check. Respondent did not believe Petitioners' claim that the original check was a good check. Petitioners advised that they would not pay additional charges because they had complied with all of their responsibilities. They asked for the return of the original check and offered to pay the rent only by money order. Respondent Cammarota refused this potential solution of the problem. Respondent Cammarota did not believe Petitioners were at the office in order to make the check good. She did not believe that Petitioners were merely asserting their legal rights under the lease and negotiable instruments law. As a result, she was suspicious and unyielding during the discussion. She wanted them to pay late fees in order to remain in possession of their apartment. Petitioners, who were tired from their journey and surprised by Respondent Cammarota's lack of receptiveness to very reasonable requests, became somewhat excited by the fact that the process to remove them from their home had begun and they were being told to pay more money than they legally owed to remain in possession. In their response to the situation, Petitioners reminded Respondent Cammarota that they were Reverends. A suggestion that Respondent Cammarota should listen to God was construed by her as "preaching". The excited utterances from Petitioners caused the leasing agent in the office to ask them to leave, which they refused to do until they had read the notice of debit Respondent had received from Barnett Bank about their check. After the notice of debit was read and returned to Quail Oaks, Petitioners began to take their leave. At this point, Respondent Cammarota said something like, "And you people call yourself ministers". On November 20, 1990, Petitioner Jacqueline Caractor gave Quail Oaks a second November 1990 rent payment in the form of a money order. A letter dated the same day from Quail Oaks advised Petitioners that the money order could not be accepted because their account had already been turned over to Quail Oaks' attorney for eviction proceedings. On November 21, 1990, eviction proceedings were filed against Petitioners by Respondent Quail Oaks for nonpayment of rent. On November 28, 1990, Petitioners filed a housing discrimination complaint against Respondents. Attempts to resolve the housing discrimination complaint through conciliation was unsuccessful. Respondent Cammarota uses the term "you people" in conversation whenever she refers to two or more people in her presence. Ordinarily, it is not used to differentiate blacks from whites. In her conversation with the Petitioners, however, the term referred to their race or religion or both. It is Respondent Cammarota's opinion that ministers should behave differently than the Petitioners were behaving when they were asserting their legal rights in her office on November 16, 1990. Respondents did not articulate some legitimate, non-discriminatory reason for the eviction action for non-payment of rent.
Recommendation Based upon the foregoing, it is RECOMMENDED: That the Board of County Commissioners enter a Final Order finding that an unlawful discriminatory housing practice occurred when Respondent Cammarota, agent for Respondent Quail Oaks, unlawfully discriminated against Petitioners because of race or color and religion. That Respondents be required to pay a $500 fine to Hillsborough County. DONE and ENTERED this 23rd day of September, 1992, at Tallahassee, Florida. VERONICA E. DONNELLY 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 23rd day of September, 1992. APPENDIX Petitioner's proposed findings of fact are addressed as follows: Accepted. Accepted. Accepted. See See HO HO #2. #11. 4. Accepted. See HO #3. 5. Accepted. See HO #5. 6. Accepted. See HO #10. 7. Accepted. See HO #11. 8. Accepted. See HO #12. 9. Accepted. See HO #13. 10. Accepted. See HO #14. 11. Accepted. See HO #14. 12. Accepted. See HO #14. 13. Accepted. See HO #18. 14. Accepted. See HO #20. 15. Accepted. See HO #21. 16. Accepted. 17. Accepted. Rejected. Irrelevant. Docket speaks for itself. See HO #22. Rejected. Irrelevant. Accepted. See HO #22. Accepted. Rejected. Contrary to fact and loose agreements. Rejected. Inconclusive evidence. Accepted. See HO #7. Accepted. See HO #13. Accepted. Accepted. Accepted. Rejected. Contrary to fact. Accepted. Accepted. See HO #16. Rejected. Argumentative. Accepted. Accepted. Accepted. Accepted. Accepted. Rejected. Irrelevant. Rejected. Irrelevant. Rejected. Irrelevant. Accepted. Accepted. See HO #2. Accepted. See HO #2. Accepted. Accepted. #17. Accepted. See HO #2. Accepted. See HO #2. Rejected. Redundant. 49.-57. Rejected. Irrelevant. Respondent's proposed findings of fact are addressed as follows: Accepted. See HO #3. Accepted. See HO #5, #7 and #8. Accepted. See HO #9. Accepted. See HO #11. Accepted. See HO #12. Accepted. See HO #13-#14. Rejected. Self serving. Accepted. See HO #21. Accepted. See HO #22. Rejected. Irrelevant. Rejected. Contrary to lease. Accepted. Accepted. See HO #2. Accepted. Accepted. Rejected. Contrary to fact and legal test for unlawful discrimination. COPIES FURNISHED: Cretta Johnson, Director Hillsborough County Equal Opportunity and Human Relations Department P.O. Box 1110 Tampa, FL 33601 John McMillan, Esquire Levin & McMillan 9385 N. 56th Street, #200 Temple Terrace, FL 33617-5594 Catherine P. Teti, Esquire Assistant County Attorney P.O. Box 1110 Tampa, FL 33601 Reverend William Caractor Qualified Representative 4747 W. Waters Avenue #3807 Tampa, FL 33614
The Issue Did Respondent violate Section 723.037(1), Florida Statutes, by failing to give timely written notice of rent increase on mobile home lots, and, if so, what penalty should be imposed?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: At all times pertinent to this proceeding, Respondent owned the Arcadia Peace River Campground (Campground) located in DeSoto County, Florida, whose mailing address is 2988 Northwest Highway 70, Arcadia, Florida 34266. From October 3, 1996 through March 21, 1998, the Campground had 14 or more of its mobile home lots occupied by mobile homes. From October 3, 1996 through March 21, 1998, seven or more of the mobile homes located in the Campground were owned by residents of the Campground other than Respondent. Furthermore, these mobile homes were placed on lots leased by the mobile home residents from the Campground. From October 3, 1996 through March 21, 1998, four or more of the mobile homes located in the Campground were owned by Respondent's employees and placed on lots in the Campground. The rental for these lots was considered as part of the employees' compensation. On January 1, 1997, Respondent implemented and began collecting a $30.00 increase in the monthly lot rental from those mobile home owners leasing spaces in the Campground. Respondent gave the affected mobile home owners written notice of the January 1, 1997, monthly lot rental increase on November 26, 1996, some 36 days prior to the effective date (January 1, 1997) of the increase. No other notice of the lot rental increase was given to the affected mobile home owners. Respondent collected the $30.00 lot rental increase from the affected mobile home owners during the period from January 1, 1997, through March 21, 1998. On January 1, 1998, Respondent implemented and began collecting a $15.00 increase in the monthly lot rental from those mobile home owners leasing spaces in the Campground. Respondent gave the affected mobile home owners written notice of the January 1, 1998, monthly lot rental increase on October 28, 1997, some 65 days prior to the effective date of the increase. Respondent collected the $15.00 monthly lot rental increase from January 1, 1998, through March 21, 1998. Each of the following affected mobile home owners paid both the $30.00 monthly lot rental increase from January 1, 1997, through March 21, 1998 and the $15.00 monthly lot rental increase from January 1, 1998, through March 21, 1998: Charles Collins; Arthur P. McRae; Harold Martin; Maurice W. Jackson; Robert F. Martin; Irene K. Apps and; Reba Conner. On March 21, 1998, the Peace River flooded the Campground. The mobile homes located in the Campground were damaged. Subsequently, the mobile homes were removed from the Campground, purchased by Respondent, or were purchased by one or more new employees of Respondent.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, and having specifically reviewed the factors set out in Section 723.006(5)(c), Florida Statutes, it is recommended that the Division enter a final order assessing Respondent with an administrative fine of $500.00. It is further recommended that Respondent be ordered to refund to Charles Collins, Arthur P. McRae, Harold Martin, Maurice W. Jackson, Robert F. Martin, Irene K. Apps, and Reba Conner all sums collected from these individuals as increases in lot rental during the period of January 1, 1997 through March 21, 1998. DONE AND ENTERED this 16th of June, 1999, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6947 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 16th day of June, 1999. COPIES FURNISHED: Philip Nowick, Director Division of Florida Land Sales, Condominiums, and Mobile Homes Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 William Woodyard, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Eric H. Miller, Esquire Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-1007 George Lempenau, Qualified Representative 2998 Northwest Highway 70 Arcadia, Florida 34266
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, as well as the parties' factual stipulations, the following relevant facts are found: Respondent Sheldon West, Inc. was the developer of Sheldon West Mobile Home Community, a "condominium," as those terms are used and defined in Chapter 718, Florida Statutes. The Declaration of Condominium was recorded in the official records of Hillsborough County on September 27, 1978. The respondent transferred control of the Sheldon West Condominium Owner's Association, Inc. to the unit owners on June 30, 1986. In the Declaration of Condominium, respondent provided a guarantee of common expenses pursuant to Section 718.116(8)(a)2, Florida Statutes. Under the guarantee, respondent was excused from the payment of common expense assessments on developer-owned units for a period of five years. During that period, respondent guaranteed to unit owners that assessments would not exceed a certain stated level, and respondent obligated itself to pay any amount of common expenses incurred during the period and not produced by the assessments at the guaranteed level receivable from other unit owners. Common expenses during the guarantee period amounted to $57,895.00. Assessments collected from unit owners during the guarantee period amounted to $49,190.00. Thus, respondent's liability for common expenses during the guarantee period was $8,705.00. Respondent's guarantee of common expenses ended September 26, 1983. From September 27, 1983, through June 30, 1986, the date of the turnover, respondent paid no assessments on the lots it still owned. The Declaration of Condominium provides that assessments not paid within five days of the due date shall bear interest at the rate of ten percent per annum from the due date until paid. Respondent's liability for assessments from September 27, 1983, through June 30, 1986, amounted to $40,870.00, and the interest on the overdue assessments amounted to $7,032.35. The Homeowners Association over-reimbursed respondent for expenses incurred during the guarantee period in the amount of $12,968.00. In addition, respondent received two payments from Association funds in June, 1986 of $7,000.00 and $8, 000.00. In January of 1986, the respondent and the Department of Business Regulation entered into a Final Consent Order, which called for a $500.00 civil penalty. The respondent paid the civil penalty, and, in March of 1986, he was reimbursed from the Association funds for payment of said penalty. The payables due from the respondent to the Homeowners Association, amounting to almost $70,000.00, were not paid to the Association at turnover. Instead, they were applied and offset against what were represented to be advances and receivables payable to the respondent from the Association in the amount of $77,142.00. This amount represents the cost of construction by the respondent of a pool and a clubhouse on the common property, interest charged on the advance of funds from respondent to the Association, and management fees due on uncollected assessments. Construction on the pool and clubhouse began in November of 1980 and ended in February of 1981. Neither the Prospectus nor the Declaration of Condominium mention the construction of a pool or clubhouse. No vote on construction of the pool and clubhouse was ever taken of unit owners other than the Board of Directors. No approval in writing was ever given by unit owners. The Declaration of Condominium was never amended to reflect the addition of a pool or clubhouse. The minutes of a special meeting of the Directors of the Association held on October 21, 1980, reflect that one of the three Directors gave a report that "residents wanted a Pool and Rec. Building" located on the common property and "were willing to pay for the same from the assessments on the residents." The minutes further reflect that a motion was made and adopted that the developer construct the pool and building and that, in return, the Association agreed to repay the developer the cost of same, estimated at $60,000.00, on or before turnover to the resident unit owners. The minutes further state "copy sent to Residents and Directors." These minutes are unsigned, but typewritten are the names of Tom F. Brown, the President of Sheldon West, Inc.; Anna K. Laughridge, Mr. Brown's daughter; and Ken Lord, who apparently was a unit owner. As reflected in a document received into evidence as petitioner's Exhibit 11, the members of the Board of Directors of the Association on January 2, 1981, consisted of Ora Katherine Brown, apparently Tom Brown's wife; and Anna K. Laughridge. The minutes of a "special joint meeting of Board of Directors" of the Association held on January 2, 1981, reflect that the resignation of Ora Katherine Brown as an officer and director was accepted, and that Tom Fairfield Brown and Anna K. Laughridge were named as Directors. The minutes of a "special meeting of directors" of Sheldon West, Inc., held at 10:00 A.M. on February 24, 1981, reflect the adoption of a motion that Sheldon West, Inc. would advance the funds for payment of the cost of construction of the pool and recreation building with the understanding that it would be repaid for the funds so advanced, and that it would receive credit therefore by the Association for any sums which might be due, owing or claimed by the Association. The minutes make reference to a promissory note evidencing the agreement. The promissory note, respondent's Exhibit 4, states that at a special meeting of the Association held on February 24, 1981, the Association agreed to repay and credit Sheldon West, Inc. for all sums advanced for the construction of the pool and recreation building. This promissory note is dated February 24, 1981, and is signed by Tom F. Brown as the President of the Association. The minutes of the "special meeting of directors" of the Association held on February 24, 1981, at 4:00 P.M. reflect that Directors Tom F. Brown, Anna K. Laughridge and Ken Lord were present. The minutes further make reference to an agreement that the costs of the pool and recreation building were to be advanced by Sheldon West, Inc. with the understanding that it would receive credit for such funds and be reimbursed for any balance on the date of turnover to the unit owners. These minutes state "copy posted outside clubhouse and del. to residents."
Recommendation Based upon the Findings of Fact and Conclusions of Law recited herein, it is RECOMMENDED that: Respondent be found guilty of violating Section 718.116(8)(a)2, Florida Statutes, for its failure to fund the deficit during the guarantee period; and that a civil penalty in the amount of $5,000.00 be imposed for this violation; Respondent be found guilty of violating Section 718.116(1)(a) and (8)(a), Florida Statutes, for its failure to pay assessments on developer-owned units after expiration of the guarantee period; and that a civil penalty in the amount of $5,000.00 be imposed for this violation; and Respondent be found guilty of violating Rule 7D- 23.003(3), Florida Administrative Code, for utilizing Association funds for the payment of a civil penalty; and that a civil penalty in the amount of $1,000.00 be imposed for this violation. Respectfully submitted and entered this 2nd day of December, 1988, in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of December, 1988. APPENDIX The proposed findings of fact submitted by the parties have been carefully considered and are accepted, incorporated and/or summarized in this Recommended Order, with the following exceptions: Petitioner 24 and 25. Accepted as factually correct, but not included as irrelevant and immaterial to the issues in dispute. Respondent 4 and 5. Partially rejected and discussed in the Conclusions of Law. 7 and 9. Rejected as irrelevant to the issues in dispute. 10. Amount stated rejected as contrary to the greater weight of the evidence. COPIES FURNISHED: Scott Charlton, Esquire Peavyhouse, Grant, Clark Charlton, Opp & Martino 1715 N. Westshore Post Office Box 24268 Tampa, Florida 33623 David L. Swanson, Esquire Sandra E. Feinzig, Esquire Assts. General Counsel Department of Business Regulation 725 S. Bronough Street Tallahassee, Florida 32399-1007 James Kearney, Director Department of Business Regulation Division of Florida Land Sales, Condominiums and Mobile Homes 725 South Bronough Street Tallahassee, Florida 32399-1007 =================================================================
Findings Of Fact While working as a real estate salesman for Gus Galloway Realty, Inc., in Ocala, Florida, Respondent was responsible for collecting monthly rent from Rose Marie Schmidt and her husband. The Schmidts rented a house belonging to one Betts and managed by Gus Galloway Realty, Inc. Sometime before July of 1977, Mrs. Schmidt was on her way to pay her rent when she met Respondent in the parking lot of Gus Galloway Realty, Inc. Respondent accepted fifty dollars in cash from Mrs. Schmidt as that month's rent, but gave her no receipt for the money. More than a week later, Respondent brought fifty dollars to the office of Gus Galloway Realty, Inc.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That Petitioner publicly reprimand Respondent. DONE and ENTERED this 14th day of March, 1979, in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 904/488-9675 COPIES FURNISHED: Joseph A. Doherty, Esquire Florida Real Estate Commission 400 West Robinson Street Orlando, Florida 32801 Mr. Pierre R. Palpant c/o Fred D. Wright 236 S. W. 10th Street Ocala, Florida 32670
The Issue Is Respondent, Westgate Home Sales, Inc. (Westgate) an employer as defined in section 760.02(7), Florida Statutes (2010), and did Westgate discriminate against Petitioner as alleged in the Employment Complaint of Discrimination?
Findings Of Fact At all times material to this proceeding, Petitioner was employed by Respondent, Westgate Home Sales, Inc. (Westgate). She worked for Respondent from January 2007 until February 15, 2008. Westgate is located in Gainesville, Florida, and is in the business of selling mobile homes. Petitioner was service manager for Respondent, and her immediate supervisor was Michael Reaves, the lot manager. Westgate is owned by Frier Home Sales, Inc. As service manager, Petitioner's primary duties were to handle warranty claims and coordinate the set up of a mobile home after it was purchased by a customer. Her work as service manager involved dealings with customers "from set up to service." Her job also involved dealing with several independent contractors. Petitioner worked in the mobile home industry most of her life, as did her family members. She worked at the sales lot which is now Westgate for approximately 18 years. During most of those years, the lot was under different ownership. Petitioner's normal work hours were 9 a.m. to 5 p.m. Monday through Friday, although she would often come in early, stay late, and work on Saturdays. Petitioner's gross earnings were approximately $400 per week. Facts Related to Requisite Number of Employees In addition to her lot manager, Mr. Reaves, Petitioner worked with James Matthew "Matt" VanEtten (sales manager); Bruce Goodson (sales), Penny Wilkes, (bookkeeper), Dana VanEtten (part- time employee and Matt VanEtten's wife); Doyle Rooks (sales), Dennis Cribbs (sales); Kyle Saborin (sales); and David Walker (sales). There is no dispute that Westgate itself did not employ 15 or more employees during the relevant time period. The dispute concerns whether other entities owned or managed by certain members of the Frier family should be considered a single-employer for purposes of the Florida Civil Rights Act. William Slaughter is employed by Frier Finance where he is Chief Financial Officer and oversees all of the accounting for approximately 30 companies, which will be referred to as the Frier Companies. Nine of these companies operate out of a location in Live Oak, Florida, including Frier Home Sales, which owns Westgate. The Live Oak location is commonly referred to by current and former employees of Westgate as "the corporate office." Members of the Frier family, specifically Wayne, Todd, and Matt Frier, are owners or directors of all of the companies operating out of the Live Oak location, and most, if not all, of the other Frier Companies. All of the companies have something to do with the mobile home industry. Matthew, Todd, and Wayne Frier are listed as Directors for Frier Home Sales, Inc., in its Articles of Incorporation; Wayne and Matthew Frier are listed as Directors of Westgate Home Sales, Inc. Frier Finance is one of the companies which operates out of the Live Oak location. Frier Finance finances mobile homes for customers, provides floor plan financing for sales lots, and provides management services for sales lots. Frier Finance negotiates things like rates on floor plan contracts, which benefit the individual lots by getting better rates. Each lot signs its own contract with the floor plan lenders. In addition to overseeing the accounting for various companies, Mr. Slaughter is responsible for hiring and overseeing three auditors, who are also employed by Frier Finance. The auditors provide monthly services to the sales lots. They assist in hiring and training bookkeepers for the sales lots, and report the financials to Mr. Slaughter, who in turn provides that information to the Friers. The auditors visit the sales lots three or four times a month conducting audits of sales, theft, inventory, and commissions. Frier Finance was paid a fee for all of the auditing and management services provided to the various sales lots, as well as for financing services. The bookkeepers at the various sales lots fill out the time sheets, and send them to Frier Finance in Live Oak. Specifically, they send the time sheets to Betty Jordan, who is Mr. Slaughter's assistant and is a bookkeeper. She handles bookkeeping and coordinates payroll for many of the sales lots, as well as for Frier Finance, Frier Home Sales, Frier Finance Floor Plan, and Frier Home Sales Floor Plan. The bookkeepers at the sales lots fax timesheets to Ms. Jordan. The timesheet form used by the various lots appears to be the same, but the time sheets reflect a lot number indicating which sales lot is reporting payroll. After receiving the faxes from the sales lots, she gives them to either Matt or Todd Frier, who then gives them back to her. Ms. Jordan then faxes the payroll information to Oasis Outsourcing, a company located in West Palm Beach, which provides professional employment services, including preparing paychecks. Ms. Jordan also handles purchase orders of mobile homes from the factory. If a lot manager wishes to purchase a mobile home, he or she faxes the purchase order to Ms. Jordan, who then gives it to Todd or Matt Frier, who then initials approval. Ms. Jordan then assigns the purchase order a number, and faxes it back to the requesting lot manager. Ms. Jordan on occasion sends memos to various sales lots regarding payroll procedures. These memos relate to services provided by Frier Finance. Again, Frier Finance is paid a fee for these payroll services. Each sales lot has its own bank account out of which it pays its own operating costs, e.g., utility bills, telephone bills, and advertising. The respective bookkeepers issue checks at the sales location on that entity's bank account, then send them to Live Oak where they are signed by either Mr. Slaughter or one of the Friers, and sent back to the sales location for distribution. A lot manager can only sign checks if he or she is a minority partner in that entity. Approximately seven or eight entities have minority partners, but the record is not clear which ones. The sales lots only issue checks for that lot, none of the other lots. Lots do not comingle their revenues or operating expenses. Lot managers are typically hired by the Friers, and only the Friers can fire lot managers. The Friers decide where to place lot managers and set the pay rates for the lot managers. The Friers have moved a lot manager from one location to another. These decisions are made by the Friers as officers or managing members of the individual companies. When a lot manager is transferred to a different lot, that manager becomes an employee of the new lot. Similarly, when a bookkeeper splits her time between two lots, her salary was paid half by one lot, and half by the other. Lot managers control the daily operations of the sales lot. Lot managers are responsible for hiring and firing employees at the various lots, with the exception of bookkeepers. If a lot manager wants to fire a bookkeeper, the manager tells Frier Finance and the decision is made there. Lot managers make the decisions as to work schedules, vacations, holiday closures, approval of sick days, and promotions. Decisions regarding lot employees are handled at the individual lots, not in a centralized location. Each lot is separately licensed, has its own sales tax number, "DMV" number, and its own phone number. Each lot "stands or falls" on its own. The lots do not have the same ownership structure. At a time prior to the time relevant to this proceeding, the Frier's corporate structure was different and the companies were, to an extent not clear from the record, more unified. At some point prior to the time-frame material to this case, this large "umbrella" corporation was split or divided into smaller companies. However, there was no evidence that any of the entities were separated or "splintered" with the intention or purpose of defeating anti-discrimination laws. Further, there was no evidence presented that establishes or suggests that the Friers or any of the companies were aware of, condoned, or tolerated the actions complained of by Petitioner herein. On the contrary, when asked on cross-examination if the Friers ever took part in the harassment, Petitioner replied, "No, no, sir. Never." Facts Related to Sexual Harassment For the majority of the time she worked at Westgate, Petitioner's office was located in an office building that was approximately the size of a double-wide mobile home with additions. Petitioner alleges that the actions and behavior of which she complains began over the last six months she was employed by Westgate. At first, she overheard inappropriate comments about customers. Eventually, the comments, and actions, were also directed at her. As is typical of a sexual harassment case, there is conflicting testimony of exactly what was said and exactly what actions took place. However, in this case, Respondent concedes, at least to some degree, that conversations took place that were inappropriate for the workplace. Respondent asserts, however, that Petitioner was a willing participant in these inappropriate conversations and exchanges. While the inappropriate language and conduct permeated the working environment at Westgate, Petitioner primarily complains about the actions of her supervisor, Mr. Reaves, and a co-worker, Mr. VanEtten. Neither Mr. Reaves nor Mr. VanEtten testified. The earliest offensive conversation Petitioner recalled was a comment made by Mr. VanEtten to her in which he told her he had a fantasy of being with an older woman.2/ Petitioner replied that he had better have a fantasy about a younger woman (referring to his wife). Petitioner complained to Mr. Reaves, who, according to Petitioner, responded that Matt "liked" her and not to be afraid of Matt because "Matt's got a little dick."3/ The allegations regarding Mr. VanEtten are numerous: Mr. VanEtten would "act out" things, or perform what Petitioner described as "skits." Many of the skits were not inappropriate and Petitioner found them to be funny. However, she failed to see the humor in "the rabbit," described below, and when it first occurred, told Mr. VanEtten to "get the fuck off of me." Petitioner described Mr. VanEtten, on many occasions, going up to the chair she was sitting in and "humping" it, which he labeled "the rabbit." She also described Mr. VanEtten as a tall, large man. Petitioner is a petite woman. Her allegation regarding Mr. VanEtten's performing "the rabbit" on her chair was corroborated by both of Petitioner's daughters who observed it on visits to their mother's office, as well as by Shiela Nickerson, a friend who cleaned mobile homes at Westgate, and Corey Bryan, the father of one of Petitioner's grandchildren.4/ In addition to "the rabbit," Petitioner asserts that Mr. VanEtten once wrapped his arms around her while they bumped into each other in the office; offered her money for sex; frequently said to her "show me your pussy"; and, on the last day she worked at the office, dropped his pants and "mooned" her showing his naked buttocks. Regarding Mr. Reeves, Petitioner asserts that he "mooned" her three or four times; used sexually charged expressions such as commenting that Petitioner must be "fucking" one of the contractors, Richard Cowart; asking her to get him an ice cream cone, saying he wanted it "big and sloppy, like a pussy, like a big ole pussy"; telling her she needed to "man up, grow a dick, be a man"; that he had a visual image of her wrapped around his head and him licking her; and frequently making remarks of a sexual nature either towards her or generally in the workplace and not directed at her. In addition to Mr. VanEtten and Mr. Reaves, Petitioner also complained about harassment by a salesman, Bruce Goodson. She related one instance when Kevin Turner, a serviceman from a carpet cleaning company, was there to clean carpet. Mr. Goodson told him, in a joking fashion but in Petitioner's presence, that Petitioner would do a lap-dance for him. Mr. Turner corroborated this allegation. Mr. Goodson did not testify. Petitioner's testimony regarding the above-described incidents was credible and largely unrebutted. Other witnesses corroborated Petitioner's depiction of the sexually-charged comments that were prevalent at Westgate. Ms. Nickerson, who assisted in cleaning mobile homes, complained of inappropriate comments by both Mr. VanEtten (stating in her presence and in the presence of Petitioner that he was horny) and Mr. Reaves (telling her how pretty her breasts were and how good her ass would look while he was hitting it from the back, and offering to put her up in a house if she slept with him); and generally that "every time I went there it was sexual comments being said." Kelly Oldman is one of Petitioner's daughters. She cleaned mobile homes for Westgate as an independent contractor. Ms. Oldman also was the recipient of many sexually charged comments by Mr. VanEtten (e.g., making obscene gestures with his mouth and gesture "nasty like he wanted you to masturbate him"; that he "grabbed his stuff" and asked if she or her mother would "help him relieve some pressure on this thing"; that he would often grind his genitals toward her; and that everything he did was sexually driven); and Mr. Reaves (telling her she needed a "sugar daddy"; hearing him on one occasion tell her mother to show him her pussy); and that she was called "bootylicious" by them and by some of the salesmen there. Petitioner frequently complained to Ms. Oldman about the office atmosphere. It must be noted that Ms. Oldman began working at Westgate at her mother's suggestion. Ms. Oldman had just become single and needed to earn money in addition to another job she had. Petitioner warned her daughter about the behavior at Westgate and, despite this behavior, spoke to Mr. Reeves about hiring her daughter to clean mobile homes. Kelly was hired to clean homes as an independent contractor. There is no real dispute that off-color jokes and office banter of a sexual nature were prevalent at Westgate. However, Respondent points to what it perceives to be Petitioner's participation in and contribution to much of the sexually charged office environment. Petitioner acknowledges that she used profanity in the workplace; that she sometimes laughed at jokes of a sexual nature; that she, at the time, sometimes found those jokes to be funny; and that she had a flirtatious relationship with Mr. Cowart, an independent contractor. Petitioner also acknowledges that her actions were not always appropriate. She described one incident that she readily admits was inappropriate. Once when she was particularly disgusted with a comment by a contractor (not an employee of Westgate) in reference to her wearing shorts during off hours that her "pussy was clean as a whistle," and to Mr. Reaves responsive comment that her "kitty-cat was clean as a whistle," she reached into her pants, grabbed some pubic hairs, and threw them at the contractor who made the comment. Petitioner also acknowledges that occasionally her grandchildren were at her office. For example, she would pick up a grandchild from daycare and keep the child at her office until her daughter got off work; or, her daughter would drop by with her grandchildren. Petitioner acknowledged that the guys would "straighten up" when her grandchildren were present. Dennis Cribbs, who worked at Westgate at least some of the time Petitioner worked there, described her language as "a lot of sexual innuendo" and, regarding her language, that he "never heard a woman speak like that." Mark Denmark, a detective with the Gainesville Police Department, had occasion to stop by Westgate and described the office conversation there as containing jokes, comments, innuendo, and banter of a sexual nature, all of which Petitioner participated. David Walker, also worked at Westgate when Petitioner worked there. He is now vice president of a mobile home lot which is a competitor of Westgate. His office was near Petitioner's, and he observed her participate in office banter, conversations, and just "normal gossip stuff" of a sexual nature. He described her language as "vulgar" and that it bothered him so much to be next to her office that he asked to be moved to another part of the building. Mr. Walker acknowledged that he was one of the persons who called Ms. Oldman "bootylicious." Mr. Cowart, who acknowledged some sort of relationship with Petitioner, provided similar testimony regarding Petitioner's participation in office banter, etc., of a sexual nature.5/ Petitioner wanted a "transfer" to another lot, and attempted to call Todd Frier about this. She left messages without detail as to why she was calling. She did not talk to Mr. Frier about a transfer, as her call was not returned. Following that and toward the end of her employment, Petitioner discussed with Mr. Reaves whether she could move her office to the back building where Penny Wilkes worked. He agreed to let her do that. However, that office was not finished prior to her ending her employment. During the last week of employment at Westgate, Petitioner was encouraged by "everyone" to quit and was being treated "really, really bad." Her office had been packed and it appeared to her she was losing her job. She had a conversation with Mr. Reaves in which she informed him she was going to file a complaint. Instead of firing her, he offered a "promotion" to her in sales. Petitioner believed that this was not a genuine offer, as she is bad in math and her experience was in service, not sales. She told him he was "fucked up." Petitioner described her leaving Westgate as follows: "I was fired. At that point I thought I was fired. Now looking at it, no. . ." ". . . I didn't get fired. I got manipulated out of there."
Recommendation Upon the consideration of the facts found and conclusions of law reached, it is RECOMMENDED: That a final order be entered by the Florida Commission on Human Relations finding that, based upon Petitioner's failure to show that the Respondent is "an employer" as defined in section 760.02(7), that the Employment Complaint of Discrimination be dismissed. DONE AND ENTERED this 5th day of May, 2011, 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 5th day of May, 2011.
The Issue The issues are as follows: (a) whether Respondent is guilty of culpable negligence or breach of trust in any business transaction in violation of Section 475.25(1)(b), Florida Statutes; (b) whether Respondent is guilty of failure to maintain trust funds in any business transaction in violation of Section 475.25(1)(k), Florida Statutes; and (c) what penalty, if any, should be imposed on Respondent.
Findings Of Fact Petitioner is charged with regulating and enforcing the statutory provisions pertaining to persons holding real estate broker and salesperson licenses in Florida. Respondent is and was, at all times material to this case, a licensed real estate broker, having been issued license No. 0372849. Respondent's license is currently voluntarily inactive because she did not renew it. At all times material here, Petitioner was an agent and the broker of record for Park Avenue Properties, Inc. In December 1995, Respondent, as agent for Park Avenue Properties, Inc., entered into an agreement with Elizabeth Field (Miss Field) to rent and manage rental property located at 1709 Hall Drive, Tallahassee, Florida (the property). Mrs. Paula Field owned the property but authorized her daughter, Miss Field, to enter into the management agreement with Respondent. The management agreement states as follows in pertinent part: Owner Agrees: to give the Agent the following authority and agrees to assume all expenses connected with: to advertise the property, display a sign on it, and rent it; to investigate the references of prospective tenants; to sign leases for terms of no less than 12 months; to renew or cancel existing leases and negotiate new leases. * * * to terminate tenancies and sign and serve notices Agent deems necessary and Owner approves; to sue for and recover rent; to instigate eviction procedures. Owner will pay expenses of litigation including attorney's fees, and may select the attorney to handle such litigation. * * * to allow Agent to collect minimum rent of $600 and deposit it to owners account. . . . * * * to allow Agent to collect a security deposit of $600 and first month's rent in advance and deposit them in Agents escrow accounts. Escrow funds accrue no interest for Owner nor Agent and are not accounted for in Owner's monthly statements. * * * 7) to allow the Agent to withhold a commission of 10 percent of all rent due on leases during the management agreement period as compensation for the management services. Pursuant to the management agreement, Respondent facilitated Donnda T. Williams' application to rent the property. The application states that, upon its acceptance, it would become a lease agreement beginning on August 22, 1997, and continuing until July 31, 1998. According to the application, rent was payable in advance on the first day of each month in installments of $595 per month. Respondent checked Ms. Williams' references but did not otherwise investigate her credit. Respondent did not perform a public records search to determine whether Ms. Williams was the subject of prior eviction proceedings or whether she had civil judgments against her. Respondent subsequently accepted the application, which became a lease agreement. Ms. Williams was late in paying the rent in September through December 1997. Respondent had to "really chase" Ms. Williams to get the rent in November 1997 because the rent check bounced when Respondent deposited it the first time. Respondent's efforts to collect the November 1997 rent included contacting Ms. Williams' mother. At that time, Respondent learned about Ms. Williams' prior eviction in Leon County and prior civil judgments as described below. Respondent's father became seriously ill in January 1998. Respondent flew to the State of Washington to nurse her father and was out of the State of Florida for most of January, February, and March of 1998. During her father's illness, Respondent made several short trips back to her home in Tallahassee, Florida. After the death of Respondent's father, she returned to Tallahassee, Florida, in April 1998. Ms. Williams did not pay her January 1998 rent until late February 1998. Respondent did not receive any additional rent payments from Ms. Williams. On March 9, 1998, Respondent sent Ms. Williams a three-day notice demanding the payment of rent. The notice stated that Ms. Williams owed $1,190 in rent for February and March 1998. There is no evidence that Respondent sent Ms. Williams any other such notices. Sometime after March 9, 1998, Harper Field, Esquire, informed Respondent that he was going to try to collect the rent for his wife, Mrs. Field. Because he was unable to collect the April 1998 rent, Mr. Field sent Ms. Williams a second three-day notice demanding payment of rent. Mr. Field insisted that Respondent begin eviction proceedings against Ms. Williams in May 1998. In fact, Mr. Field "begged" Respondent to initiate these proceedings on his wife's behalf. Any evidence that Ms. Field requested Respondent to begin eviction proceedings in January or February 1998 is hearsay and in direct conflict with Respondent's testimony, which is credited in this regard. Respondent initiated an eviction proceeding against Ms. Williams on May 4, 1998. In a letter dated June 2, 1998, from Respondent to the circuit judge, Respondent stated as follows: (a) Ms. Williams had not paid any rent since paying the January 1998 rent in February 1998; (b) Ms. Williams was five months behind in paying her rent; (c) Ms. Williams was still living at the property; and (d) Ms. Williams has a prior eviction in Leon County, Florida, and had a judgment against her for not paying for her furniture. Respondent sent a copy of the letter to Mr. Field, informing him for the first time about Ms. Williams' prior eviction and about the civil judgments against her. The record indicates that First Union Bank secured a Final Judgment and Execution against Ms. Williams in May 1995. W.S. Badcock Corporation secured a Writ of Replevin and Possession against Ms. Williams in October 1996. In a third case, Charles Culp secured a Final Judgment for Eviction and a Writ of Possession against Ms. Williams in April 1997. There is persuasive evidence that Respondent became aware of these cases against Ms. William when Respondent contacted Ms. Williams' mother in November 1998. Ms. Williams vacated the property owing six months of rent for the months of February through July 1998 before Respondent's eviction proceeding against Ms. Williams was concluded. Ms. Williams "trashed" the property before she vacated it causing Mrs. Fields to incur out-of-pocket expenses for damages not covered by insurance. The record is not clear how Respondent's eviction case against Ms. Williams was finally resolved. However, the Administrative Complaint does not allege that Respondent was negligent in prosecuting the case. Mr. Fields subsequently filed a complaint with Petitioner alleging that Respondent had mismanaged the property. During the investigation of the complaint, Respondent furnished Petitioner with requested documentation regarding the entire Williams/Field transaction for the months of February through April 1998. The documentation included monthly statement reconciliations for Respondent's rental escrow account and her operating account, bank statements for these accounts, and copies of supporting checks, deposits slips, and transfers. Respondent's monthly statement reconciliations for her rental escrow account from February through April 1998 revealed negative balances. The monthly statement reconciliations are a more accurate reflection of the transactions that occurred in the account than a corresponding bank statement. Respondent transferred $1,000 from her rental escrow account to her operating account on February 10, 1998. Respondent's February and April bank statements for her rental escrow account and her operating account did not reflect negative balances. Respondent's March 1998 bank statement for the rental escrow account had two overdrafts, one on March 19 and another one on March 20. She transferred $1,000 on March 2, 1998, and $8,000 on March 16, 1998, from her rental escrow account to her operating account. The $8,000 transfer resulted in a negative balance on Respondent's monthly statement reconciliation for her rental escrow account. Respondent made the transfers referenced above because she was in the State of Washington nursing her father when she was required to make disbursements from the rental escrow account. She claims that she went to see her father after receiving an emergency call that her father was gravely ill and that she grabbed her operating account checkbook to take with her. She did not have the rental escrow account checkbook with her so she transferred the money to her operating account and wrote the necessary disbursement checks from her operating account. Respondent flew home to Florida from the State of Washington for a few days in January 1998, and at the end of February and March 1998, before making her final trip home to Florida in April 1998. She did not explain why she did not pick up her rental escrow account checkbook on one of these trips so that she would not have to continue to disburse money from her operating account that should have been disbursed from her rental escrow account. More importantly, Respondent did not explain why her monthly statement reconciliations had negative balances. Respondent did not inform her clients that she was paying them from her operating account. The clients never noticed that Respondent paid them from the wrong account. All of the clients received the correct disbursements. Even so, Respondent knew she was not allowed to commingle funds in the two accounts and that she was required to keep all rental escrow funds in a separate account until disbursement was properly authorized. The instant case is not the only time that Respondent has been the subject of a disciplinary proceeding. She admitted during the hearing that Petitioner previously had cited her and "smacked her on the wrist" for not disbursing funds in a timely fashion.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Florida Department of Business and Professional Regulation, Division of Real Estate, enter a final order revoking Respondent's license. DONE AND ENTERED this 15th day of November, 2002, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD 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 15th day of November, 2002. COPIES FURNISHED: Kenneth D. Cooper, Esquire 400 Southeast Eighth Street Fort Lauderdale, Florida 33316 Stacy N. Robinson Pierce, Esquire Department of Business and Professional Regulation 400 West Robinson Street Suite N308 Orlando, Florida 32801-1772 Buddy Johnson, Director Nancy P. Campiglia, Chief Attorney Division of Real Estate Department of Business and Professional Regulation Post Office Box 1900 Orlando, Florida 32802-1900 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202
Findings Of Fact The parties stipulated during the course of the formal hearing in this cause that the adjustments made by Respondent to Petitioner's Medicaid cost report for the fiscal year ending June 30, 1981, were the same as the adjustments made by Respondent to Petitioner's Medicaid cost report for the fiscal year ending June 30, 1980. They therefore presented evidence and arguments on the adjustments made for 1980 with the stipulation that if Petitioner prevailed regarding any item which was adjusted for 1980, then that item would automatically be so adjusted for 1981. The parties further stipulated that the cost item "return on equity" is merely a function of the other proposed adjustments and, therefore, if the Petitioner prevailed on other disputed adjustments herein, then "return on equity" would be automatically revised to reflect an increase. Respondent proposed an adjustment to Petitioner's Medicaid cost report for the fiscal year ending June 30, 1980, in the amount of $15,223 for short- term liabilities. At the commencement of the formal hearing, Respondent withdrew its adjustment to that item and stipulated that Petitioner was correct in its position. Accordingly, that portion of the dispute has been withdrawn from consideration herein. Petitioner claimed $5,191 as the advertising cost for Hollywood Hills Nursing Home in the fiscal year ending June 30, 1980, which amount represents the cost of a large, yellow pages advertisement in the Southern Bell Telephone Directory. Respondent disallowed all Southern Bell advertising cost except for the sum of $178.20, which represents the cost of a simple alphabetical listing in the yellow pages. The advertisement in question is excessive in size and primarily consists of the name of the facility, a reproduction of the facility's logo, a picture of the facility, and a picture of a very happy couple. The ad is not primarily informational but rather is clearly promotional and intended to increase patient utilization. Accordingly, Respondent properly, disallowed this cost item and properly allowed the cost of a simple alphabetical listing, the norm in the nursing home industry at the time. In the fiscal year ending June 30, 1980, Petitioner included in its cost report the sum of $37,147.18 representing the "Herlee consulting fee," and Petitioner further claimed a similar amount as a cost item in its 1981 report. Respondent disallowed this reported home office cost. This cost includes salaries for Herbert and Leonore Kallen and other allocated expenses of the "home office" such as rent, automobiles, utilities, insurance, depreciation and amortization thereof, legal fees, and outside consulting fees. Respondent disallowed all Herlee expenses. The Kallens own three health care providers which are located in two facilities, to wit: Hollywood Hills Nursing Home and Hollywood Pavilion Psychiatric Hospital located in the same facility in Hollywood, Florida; and Norwichtown Convalescent Home located in Norwichtown, Connecticut. Contracts were entered into on behalf of these providers whereby they would be managed by Herlee Management Company, another of the Kallens' corporations. Although Herlee, Inc., was formed to manage the Kallens' two physical facilities under the "chain organization" provisions of the health insurance manual, none of the Herlee or home office costs are proper. No documents reflect the proportion of the Kallens' time which is spent in managing Hollywood Hills Nursing Home. Petitioner's evidence ranges from the Kallens spending an approximate 12.5 percent of their time to them spending an approximate 75 percent of their time related to Petitioner. The evidence is simply not credible. No time sheets exist; likewise, no records exist regarding any duties performed at any particular time. Rather, both the administrator and the "executive manager" of Hollywood Hills Nursing Home are full-time employees of Herlee Management Corporation, both of whom were capable of performing and did perform all of the duties alleged to have been performed by the Kallens at unknown times. The Herlee home office cost/Herlee consulting fee is not documented, is not reasonable, is duplicitous rather than necessary, and is not related to any patient care. Any time spent by the Kallens in the management of Hollywood Hills Nursing Home, if any, was spent merely as a protection of their financial investment. In further support of the lack of documentation to substantiate this cost item, it is noteworthy that Petitioner's witnesses did not even agree on the location of the Kallens' home office. Respondent properly disallowed the Herlee cost items as to the Kallens and properly allowed only that portion of the cost which related to the salary and benefits paid to the full-time employee of Herlee who also served as the nursing home administrator. The Kallens acquired Hollywood Hills Nursing Home through a purchase of stock rather than through a purchase of assets. Petitioner, therefore, took its vendor's basis for depreciation purposes directly from the books of its predecessor. When the audit of 1980 and again of 1981 revealed that Petitioner had no documentation on which to substantiate the basis used for depreciation, Respondent could have disallowed all property costs. Rather than doing so and possibly forcing Petitioner out of the Medicaid program or out of business, Respondent utilized the next best source of information, a 1969 appraisal indicating a verified construction cost, although utilizing that appraisal was admittedly a departure from normal audit procedures. The deviation from normal auditing principles is proper in this situation where Petitioner could provide no documentation to substantiate its basis for depreciation, and the appraisal provided estimates of cost at the time the facility was constructed. The adjustments made by Respondent for both 1980 and 1981 were therefore proper. Petitioner claimed $7,844 as an amortization expense for the fiscal year ending June 30, 1980, and $6,747 as the amortization expense for the fiscal year ending June 30, 1981. Amortization expense is the cost of acquiring the original mortgage on the facility and is a legitimate and recognized expense which is reimbursable under Medicaid regulations. Respondent totally disallowed Petitioner's claimed amortization expense since Petitioner possesses no data showing the actual cost of financing. Petitioner also failed to present any evidence as to when the Kallens purchased the facility, as to when the mortgage was placed on the facility, and as to whether the Kallens assumed a prior mortgage or obtained their own financing. Accordingly, Respondent properly disallowed the amortization expense in both Petitioner's 1980 and 1981 cost reports. Respondent had made a total adjustment for non-legend drugs in the amount of $15,244 for 1980 and 1981 combined. At the formal hearing, counsel requested an opportunity to attempt to work out an independent solution to this adjustment in order to remove that adjustment from consideration herein. The parties have agreed posthearing that $11,185 out of the Respondent's $15,244 adjustment should be disallowed and overpayment deductions by Respondent have been erroneous. Accordingly, Petitioner is entitled to receive from the Respondent the amount of $11,185 representing this non-legend drugs item.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered upholding Respondent's adjustments to Petitioner's Medicaid cost reports for the fiscal years ending June 30, 1980, and June 30, 1981, as to advertising, the Herlee consulting fee/home office costs, depreciation, and amortization; making any adjustment necessary as to Petitioner's return on equity; withdrawing Respondent's adjustment for short- term liabilitites for 1980; and memorializing the terms of the parties' stipulation as to non-legend drugs. DONE and RECOMMENDED this 4th day of April, 1984, in Tallahassee, Leon County, Florida. LINDA M. RIGOT, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 4th day of April, 1984. COPIES FURNISHED: Howard Todd Jaffe, Esquire 1915 Harrison Street Hollywood, Florida 33020-5098 Jay Adams, Esquire Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32301 David H. Pingree, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32301
