The Issue Whether Respondent, Citrus Direct, LLC, owes Petitioner, Marvin Hajos, the sum of $5,397.00 for citrus that was purchased, but not harvested.
Findings Of Fact At all times material to the instant case, Petitioner and Citrus Direct were involved in the growing and marketing of citrus fruit in the State of Florida. On June 12, 2008, Citrus Direct agreed to purchase fruit from Petitioner. The terms of their agreement were reduced to writing. The "Fresh Fruit Contract" provided that Citrus Direct would purchase from Petitioner all of the varieties of citrus fruits of merchantable quality as delineated in the contract. More specifically, Citrus Direct was entitled to purchase "Valencia" oranges from Petitioner for "$3.00 on tree net" per box. The terms of the contract suggests that it is for "citrus fruit for the year 2005/2006 and merchantable at the time of picking. . . ." The contract does not identify a total amount of fruit expected from the grove. Prior to entering into the above-referenced contract, Petitioner had made arrangements with an unidentified third party to have the grove picked, but for some reason, that agreement fell through. Jason Cooper, known in the citrus business as a "bird dog," brought the parties together. Mr. Cooper is an independent contractor who finds grove owners who need to have their groves picked and refers them to buyers. The "Fresh Fruit Contract" was signed on June 12, 2008. The grove was picked on June 15, 17, 26 and 30, 2008. Two hundred and sixty-four boxes of fruit were picked from Petitioner's grove. Petitioner received payment of $603.00. Citrus Direct forwarded an additional check for $189.00 to Petitioner; however, Petitioner did not receive the check. No admissible evidence was received regarding the number of boxes of fruit that were anticipated from the grove. However, on June 30, 2008, all the fruit that was reasonably available to be picked in the grove had been picked.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Department Agriculture and Consumer Services enter a final order dismissing Petitioner, Marvin Hajos', Amended Complaint, but requiring Respondent, Citrus Direct, LLC, to pay Petitioner $189.00, if that amount has not already been paid. DONE AND ENTERED this 27th day of April, 2009, in Tallahassee, Leon County, Florida. S JEFF B. CLARK 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 27th day of April, 2009. COPIES FURNISHED: Honorable Charles H. Bronson Commissioner of Agriculture Department of Agriculture and Consumer Services The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810 Richard D. Tritschler, General Counsel Department of Agriculture and Consumer Services 407 South Calhoun Street, Suite 520 Tallahassee, Florida 32399-0800 Christopher E. Green, Esquire Department of Agriculture and Consumer Services Office of Citrus License and Bond Mayo Building, Mail Station 38 Tallahassee, Florida 32399-0800 Marvin Hajos 3510 Northwest 94th Avenue Hollywood, Florida 33024 State Farm Fire and Casualty Company One State Farm Plaza Bloomington, Illinois Hans Katros Citrus Direct, LLC 61710 1406 Palm Drive Winter Haven, Florida 33884
The Issue Whether the Respondent Alilev Corporation failed to pay amounts owing to the Petitioner for the shipment of citrus fruit, as set forth in the Complaint dated April 30, 2001, and, if so, the amount the Petitioner is entitled to recover.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: At all times material to this proceeding, Fresh Fruit Express and Bay Harbor Fine Foods were "citrus fruit dealers" licensed by the Department. Bay Harbor Fine Foods is a retail grocery store. As part of its business, it sells to its retail customers "gift fruit" consisting of oranges and grapefruit for shipment to third persons identified by the customers. Arthur C. Bergen is an owner of Bay Harbor Fine Foods and acted on its behalf with respect to the transactions that are the subject of this proceeding. Fresh Fruit Express is in the business of packaging and shipping "gift fruit" consisting of oranges and grapefruit pursuant to orders placed by other citrus fruit dealers. Barbara Spiece is the president of Fresh Fruit Express and acted on its behalf with respect to the transactions that are the subject of this proceeding. In November and December 1999, Fresh Fruit Express received via facsimile transmittal a number of orders for "gift fruit" from Bay Harbor Fine Foods. Most of the orders were for single shipments of fruit, although a few orders were for 12 monthly shipments of fruit. This was the first year Bay Harbor Fine Foods had done business with Fresh Fruit Express, and Bay Harbor Fine Foods and Fresh Fruit Express did not execute a written contract governing their business relationship. On the night of Sunday, December 12, 1999, Fresh Fruit Express's packinghouse was destroyed by fire, and its offices were substantially damaged. The fire could not have happened at a worse time because it was at the peak of the holiday fruit- shipping season. Fresh Fruit Express was able to move into temporary offices and to obtain the use of a packinghouse very quickly. It had telephone service at approximately noon on Tuesday, December 14, 1999, and it began shipping "gift fruit" packages on Friday, December 17, 1999, to fill the orders its had received. Mr. Bergen, the owner of Bay Harbor Fine Foods, learned of the fire at Fresh Fruit Express and attempted to contact its offices for an update on the orders Bay Harbor Fine Foods had placed for shipment during the holidays. Mr. Bergen was unable to contact anyone at Fresh Fruit Express for three or four days after the fire, and he was worried that his customers' orders for "gift fruit" would not be shipped on time.1 Mr. Bergen called two other packinghouses and placed orders duplicating some of the orders Bay Harbor Fine Foods had placed with Fresh Fruit Express. Mr. Bergen directed these packinghouses to ship the duplicate orders via expedited Federal Express and United Parcel Service shipping, and Bay Harbor Fine Foods incurred extra costs for the expedited shipping. Meanwhile, Fresh Fruit Express was giving priority to its smaller wholesale customers such as Bay Harbor Fine Foods, and it shipped all of the orders it had received from Bay Harbor Fine Foods. Bay Harbor Fine Foods did not cancel its orders with Fresh Fruit Express or otherwise notify Fresh Fruit Express that it should not ship the fruit; Mr. Bergen assumed that Fresh Fruit Express would contact him if it intended to ship the fruit ordered by Bay Harbor Fine Foods. Fresh Fruit Express prepared invoices for Bay Harbor Fine Foods dated January 24, 2000, in the amounts of $60.01, $599.43, and $511.80, respectively, for "gift fruit" shipments made in November and December 1999; it prepared an invoice for Bay Harbor Fine Foods dated February 18, 2000, in the amount of $92.00 for "gift fruit" shipments made in January and February 2000; it prepared an invoice for Bay Harbor Fine Foods dated March 21, 2000, in the amount of $69.34 for "gift fruit" shipments made in February and March 2000; and it prepared an invoice for Bay Harbor Fine Foods dated April 17, 2000, in the amount of $44.40 for "gift fruit" shipments made in April 2000. According to the invoices, Bay Harbor Fine Foods owed Fresh Fruit Express $1,376.98 as of April 17, 2000. All of the invoices to Bay Harbor Fine Foods that were submitted by Fresh Fruit Express contain the following: "Terms: Net 14 days prompt payment is expected and appreciated. A 1½% monthly service charge (A.P.R. 18% per annum) may be charged on all past due accounts. " By late April 2000, Fresh Fruit Express had not received payment for any of the "gift fruit" shipped pursuant to the orders placed by Bay Harbor Fine Foods. Ms. Spiece contacted Bay Harbor Fine Foods in late April 2000 and inquired about payment of the amounts owing. Ms. Spiece was told that Bay Harbor Fine Foods had no invoices from Fresh Fruit Express. Ms. Spiece sent duplicate invoices to Bay Harbor Fine Foods, and she called to confirm that the invoices had been received. After several attempts by Fresh Fruit Express to collect the amounts invoiced to Bay Harbor Fine Foods, Mr. Bergen tendered a check dated July 11, 2000, to Fresh Fruit Express on the Bay Harbor Fine Foods account in the amount of $591.90. The check was accompanied by a letter signed by Mr. Bergen, in which he stated: Enclosed is a check in the amount of $591.90 covering the shipments that we know were not duplicated due to your fire in late December. This amount reflects a deduction of $341.95 in freight charges paid by us to U.P.S. and Fed. Ex. to make our promised Christmas deadline. In the statement attached to the complaint filed with the Department, Fresh Fruit Express claims that Bay Harbor Fine Foods owes it a total of $1,034.62, which amount includes a credit for the $591.90 paid by Bay Harbor Fine Foods in July 2000 and amounts shown as "Finance" charges for the months of February 2000 through April 2001. Bay Harbor Fine Foods does not dispute Fresh Fruit Express's claim that $1,376.98 worth of "gift fruit" was shipped by Fresh Fruit Express pursuant to orders Bay Harbor Fine Foods placed in November and December 1999. Bay Harbor Fine Foods' position is that it need not pay Fresh Fruit Express for the fruit because Fresh Fruit Express did not notify it after the December 12, 1999, fire that it would ship the orders and because Bay Harbor Fine Foods had to make sure that its customers' orders were filled. The uncontroverted evidence establishes that Bay Harbor Fine Foods was, at the times material to this proceeding, a Florida-licensed and -bonded citrus fruit dealer; that, in November and December 1999, Bay Harbor Fine Foods submitted orders to Fresh Fruit Express for the shipment of "gift fruit" consisting of oranges and grapefruit; that Fresh Fruit Express shipped all of the "gift fruit" ordered by Bay Harbor Fine Foods in November and December 1999; that the price of the "gift fruit" shipped by Fresh Fruit Express pursuant to Bay Harbor Fine Foods' orders totaled $1,376.98; that Bay Harbor Fine Foods paid Fresh Fruit Express $591.90 on its account on July 11, 2000; and that Fresh Fruit Express timely filed its complaint alleging that Bay Harbor Fine Foods failed to promptly pay its indebtedness to Fresh Fruit Express for citrus products shipped pursuant to orders placed by Bay Harbor Fine Foods. Fresh Fruit Express is, therefore, entitled to payment of the principal amount of $785.08, plus pre-judgment interest. Fresh Fruit Express presented no evidence to establish that it actually sent the invoices to Bay Harbor Fine Foods on or about the dates stated on the invoices. Therefore, payment of the $1,376.98 was due on May 1, 2000, after Ms. Spiece sent duplicate invoices to Bay Harbor Fine Foods and confirmed that they had been received, and pre-judgment interest on this amount would begin accruing on May 1, 2000. The payment of $591.90 on July 11, 2000, reduced the principal balance owing to Fresh Fruit Express to $785.08, and pre-judgment interest on this amount would begin accruing on July 12, 2000.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order ordering Alilev Corporation, d/b/a Bay Harbor Fine Foods, to pay $785.08 to Spyke's Grove, Inc., d/b/a Fresh Fruit Express, Emerald Estate, and Nature's Classic, together with pre-judgment interest calculated at the rate specified in Section 55.03, Florida Statutes, on the amounts owing. DONE AND ENTERED this 2nd day of October, 2001, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 2nd day of October, 2001.
The Issue The issue for determination is whether Department of Citrus Rules 20-1.009 and 20-1.010, Florida Administrative Code, are invalid exercises of delegated legislative authority, as alleged by Petitioners.
Findings Of Fact John Stephens, Inc., Petitioner, was at all times material hereto a Florida corporation duly licensed as a citrus fruit dealer in the State of Florida. J. A. Stephens, Inc., was a Florida corporation, and held a valid fruit dealer’s license in the State of Florida. At all times material to this proceeding, Petitioner, John A. Stephens, served as an officer and director of J. A. Stephens, Inc. John A. Stephens is not an officer, director or shareholder of John Stephens, Inc. John A. Stephens, Jr. is the president and sole director of John Stephens, Inc. and is not an officer, director nor shareholder of J. A. Stephens, Inc. On or about September 26, 1996, Petitioners, John Stephens, Inc., and John A. Stephens, applied to the Florida Department of Agriculture and Consumer Services to register John A. Stephens as an agent of John Stephens, Inc., pursuant to Section 601.601, Florida Statutes. The application form furnished by the Department of Agriculture and Consumer Services indicates that the licensed dealer seeking registration of an agent agrees to “... accept full responsibility for all his activities....” (Petitioners’ Exhibit 1) By letter dated December 26, 1996, Petitioners were advised by the Department of Agriculture and Consumer Services that their application for registration of John A. Stephens as an agent of John Stephens, Inc., had been denied on the basis of Rule 20-1.010, Florida Administrative Code. As indicated in the notice, that rule provides, in part, that an application for registration of a dealer’s agent can be disapproved if a proposed registrant has a “...record, either as an individual, co- partnership, corporation, association or other business unit, showing unsatisfied debts or orders issued by the Commissioner of Agriculture with respect to prior dealings in citrus fruit.” (Petitioners’ Exhibit 1.) Specifically, the Department of Agriculture and Consumer Services advised Petitioners that “...Mr. Stephens has not satisfied orders issued by the Commissioner of Agriculture with respect to prior dealings in citrus fruit...,” listing as the final orders in question Petitioners’ Exhibits 3 through 14. Between April 30, 1991, and September 30, 1992, the State of Florida, Department of Agriculture and Consumer Services entered a total of 12 final administrative orders in which it found that J. A. Stephens, Inc., was indebted to claimants for various sums arising from prior dealings in citrus fruit. (Petitioners’ Exhibits 3 through 14.) At the time of the action of the Department of Agriculture and Consumer Services denying Petitioners’ application, there remained amounts due and unpaid on each of the orders entered by the Department against J. A. Stephens, Inc. Petitioner, John A. Stephens was not named as a party respondent in any of the 12 proceedings culminating in final orders against J. A. Stephens, Inc., which formed the basis for the denial by the Department of the application for registration as a citrus dealer’s agent. (Petitioners’ Exhibits 2, and 3 through 14.) In denying a Motion for Relief for Final Order in the only Department of Agriculture and Consumer Services proceeding in which a claimant sought to join Mr. Stephens individually as a party, the Department found that: The complaint filed by Claimant named J. A. Stephens, Inc. as the respondent. Because the complaint was against J. A. Stephens, Inc., it was served on J. A. Stephens, Inc. J. A. Stephens, an individual, was never subjected to the jurisdiction of the Agency with regard to this matter. J. A. Stephens, an individual, was not afforded an opportunity to defend against the allegations of the complaint. There was no discussion at the hearing about whether J. A. Stephens, Inc. was or was not the proper respondent. There was no allegation at the hearing that J. A. Stephens, an individual, was the proper respondent. The Claimant has failed to express any legal basis for grant of his motion and this Agency could find no such basis. This Agency has no personal jurisdiction over J. A. Stephens, an individual, with regard to this matter and therefore cannot enter an order with respect to him. Further, even if such an order were to be entered, it would be of no force or effect because of the lack of personal jurisdiction. (Petitioners’ Exhibit 4, pg. 2.) The rules that are the subject of this proceeding had their inception in 1964, when the Florida Citrus Commission considered and adopted rules governing the registration of agents acting on behalf of licensed citrus dealers. These rules, which appear in the text of the minutes of the Commission as Regulation 105-1.05, are almost verbatim the same rules now found in Chapter 20-1, Florida Administrative Code. (Respondent’s Exhibits 1 and 2.) As reflected in the minutes of the Florida Citrus Commission, the rules were adopted to help protect the grower and shipper or processor in matters involving the normal movement of citrus fruit in all channels of distribution. The regulation was recommended by the Fresh Citrus Shippers Association and was endorsed by a resolution of the Florida Sheriffs Association. In presenting the Sheriffs’ resolution to the Commission, Sheriff Leslie Bessenger of the Florida Citrus Mutual Fruit Protection Division cited the results of a seven-month investigation that found 71 out of 200 registered agents with criminal records. Those two hundred agents represented only nine dealers. (Respondent’s exhibit 1, June 19, 1964, meeting.) Minutes of Commission meetings after rule adoption thoroughly explain the efforts to require accountability and curb abuse of the dealer- agent relationship. The rules, as they appear today in the Florida Administrative Code, have not been revised since July 1, 1975.
The Issue The issue in DOAH Case No. 02-3648RE is whether Emergency Rules 20ER02-01, 20ER02-02, and 20ER02-03 constitute an invalid exercise of delegated legislative authority. The issue in DOAH Case No. 02-4607RP is whether Proposed Rules 20-15.001, 20- 15.002, and 20-15.003, Florida Administrative Code, constitute an invalid exercise of delegated legislative authority.
Findings Of Fact Based on the stipulated facts, and the entire record in this proceeding, the following findings of fact are made: The Florida Citrus Commission was established in 1935 to organize and promote the growing and sale of various citrus products, fresh and processed, in the State of Florida. The purpose of the Citrus Commission is today reflected in Section 601.02, Florida Statutes. The powers of the Florida Citrus Commission ("the Commission") and the Department, are set forth in full in Section 601.10, Florida Statutes. The powers of the Department include the power to tax and raise other revenue to achieve the purposes of the Department. In particular, Section 601.10(1) and (2), Florida Statutes, state: The Department of Citrus shall have and shall exercise such general and specific powers as are delegated to it by this chapter and other statutes of the state, which powers shall include, but shall not be confined to, the following: To adopt and, from time to time, alter, rescind, modify, or amend all proper and necessary rules, regulations, and orders for the exercise of its powers and the performance of its duties under this chapter and other statutes of the state, which rules and regulations shall have the force and effect of law when not inconsistent therewith. To act as the general supervisory authority over the administration and enforcement of this chapter and to exercise such other powers and perform such other duties as may be imposed upon it by other laws of the state. The Department is authorized to set standards by Section 601.11, Florida Statutes, as follows: The Department of Citrus shall have full and plenary power to, and may, establish state grades and minimum maturity and quality standards not inconsistent with existing laws for citrus fruits and food products thereof containing 20 percent or more citrus or citrus juice, whether canned or concentrated, or otherwise processed, including standards for frozen concentrate for manufacturing purposes, and for containers therefor, and shall prescribe rules or regulations governing the marking, branding, labeling, tagging, or stamping of citrus fruit, or products thereof whether canned or concentrated, or otherwise processed, and upon containers therefor for the purpose of showing the name and address of the person marketing such citrus fruit or products thereof whether canned or concentrated or otherwise processed; the grade, quality, variety, type, or size of citrus fruit, the grade, quality, variety, type, and amount of the products thereof whether canned or concentrated or otherwise processed, and the quality, type, size, dimensions, and shape of containers therefor, and to regulate or prohibit the use of containers which have been previously used for the sale, transportation, or shipment of citrus fruit or the products thereof whether canned or concentrated or otherwise processed, or any other commodity; provided, however, that the use of secondhand containers for sale and delivery of citrus fruit for retail consumption within the state shall not be prohibited; provided, however, that no standard, regulation, rule, or order under this section which is repugnant to any requirement made mandatory under federal law or regulations shall apply to citrus fruit, or the products thereof, whether canned or concentrated or otherwise processed, or to containers therefor, which are being shipped from this state in interstate commerce. All citrus fruit and the products thereof whether canned or concentrated or otherwise processed sold, or offered for sale, or offered for shipment within or without the state shall be graded and marked as required by this section and the regulations, rules, and orders adopted and made under authority of this section, which regulations, rules, and orders shall, when not inconsistent with state or federal law, have the force and effect of law. The Department is authorized to conduct citrus research by Section 601.13, Florida Statutes. To help pay for these duties of the Department, the Legislature first enacted the "box tax" in 1949. The box tax is now codified as Section 601.15(3), Florida Statutes. Section 601.15(3)(a), Florida Statutes, provides in relevant part: There is hereby levied and imposed upon each standard-packed box of citrus fruit grown and placed into the primary channel of trade in this state an excise tax at annual rates for each citrus season as determined from the tables in this paragraph and based upon the previous season's actual statewide production as reported in the United States Department of Agriculture Citrus Crop Production Forecast as of June 1. Section 601.15(3)(a), Florida Statutes, goes on to set forth specific rates for fresh grapefruit, processed grapefruit, fresh oranges, processed oranges, and fresh or processed tangerines and citrus hybrids. Section 601.15(1), Florida Statutes, sets forth the Department's authority to administer the box tax, as follows: The administration of this section shall be vested in the Department of Citrus, which shall prescribe suitable and reasonable rules and regulations for the enforcement hereof, and the Department of Citrus shall administer the taxes levied and imposed hereby. All funds collected under this section and the interest accrued on such funds are consideration for a social contract between the state and the citrus growers of the state whereby the state must hold such funds in trust and inviolate and use them only for the purposes prescribed in this chapter. The Department of Citrus shall have power to cause its duly authorized agent or representative to enter upon the premises of any handler of citrus fruits and to examine or cause to be examined any books, papers, records, or memoranda bearing on the amount of taxes payable and to secure other information directly or indirectly concerned in the enforcement hereof. Any person who is required to pay the taxes levied and imposed and who by any practice or evasion makes it difficult to enforce the provisions hereof by inspection, or any person who, after demand by the Department of Citrus or any agent or representative designated by it for that purpose, refuses to allow full inspection of the premises or any part thereof or any books, records, documents, or other instruments in any manner relating to the liability of the taxpayer for the tax imposed or hinders or in anywise delays or prevents such inspection, is guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083. The box tax was challenged in 1936 and the Florida Supreme Court issued an opinion in 1937 upholding the validity of the box tax. C.V. Floyd Fruit Company v. Florida Citrus Commission, 128 Fla. 565, 175 So. 248 (1937). In 1970, the Legislature enacted the "equalization tax," codified as Section 601.155, Florida Statutes. The statute mirrored Section 601.15, Florida Statutes, but added certain processors who were mixing foreign citrus products with Florida products. The purpose of the equalization tax was to have all Florida processors of citrus products help pay for the costs of the Department, rather than have the burden fall entirely on the Florida growers subject to the box tax. Section 601.155, Florida Statutes, provides, in relevant part: The first person who exercises in this state the privilege of processing, reprocessing, blending, or mixing processed orange products or processed grapefruit products or the privilege of packaging or repackaging processed orange products or processed grapefruit products into retail or institutional size containers or, except as provided in subsection (9) or except if a tax is levied and collected on the exercise of one of the foregoing privileges, the first person having title to or possession of any processed orange product or any processed grapefruit product who exercises the privilege in this state of storing such product or removing any portion of such product from the original container in which it arrived in this state for purposes other than official inspection or direct consumption by the consumer and not for resale shall be assessed and shall pay an excise tax upon the exercise of such privilege at the rate described in subsection (2). Upon the exercise of any privilege described in subsection (1), the excise tax levied by this section shall be at the same rate per box of oranges or grapefruit utilized in the initial production of the processed citrus products so handled as that imposed, at the time of exercise of the taxable privilege, by s. 601.15 per box of oranges. In order to administer the tax, the Legislature provided the following relevant provisions in Section 601.155, Florida Statutes: Every person liable for the excise tax imposed by this section shall keep a complete and accurate record of the receipt, storage, handling, exercise of any taxable privilege under this section, and shipment of all products subject to the tax imposed by this section. Such record shall be preserved for a period of 1 year and shall be offered for inspection upon oral or written request by the Department of Citrus or its duly authorized agent. Every person liable for the excise tax imposed by this section shall, at such times and in such manner as the Department of Citrus may by rule require, file with the Department of Citrus a return, certified as true and correct, on forms to be prescribed and furnished by the Department of Citrus, stating, in addition to other information reasonably required by the Department of Citrus, the number of units of processed orange or grapefruit products subject to this section upon which any taxable privilege under this section was exercised during the period of time covered by the return. Full payment of excise taxes due for the period reported shall accompany each return. All taxes levied and imposed by this section shall be due and payable within 61 days after the first of the taxable privileges is exercised in this state. Periodic payment of the excise taxes imposed by this section by the person first exercising the taxable privileges and liable for such payment shall be permitted only in accordance with Department of Citrus rules, and the payment thereof shall be guaranteed by the posting of an appropriate certificate of deposit, approved surety bond, or cash deposit in an amount and manner as prescribed by the Department of Citrus. * * * (11) This section shall be liberally construed to effectuate the purposes set forth and as additional and supplemental powers vested in the Department of Citrus under the police power of this state. In March 2000, certain citrus businesses challenged Section 601.155(5), Florida Statutes, as being unconstitutional. At the time of the suit, Section 601.155(5), Florida Statutes, read as follows: All products subject to the taxable privileges under this section, which products are produced in whole or in part from citrus fruit grown within the United States, are exempt from the tax imposed by this section to the extent that the products are derived from oranges or grapefruit grown within the United States. In the case of products made in part from citrus fruit grown within the United States, it shall be the burden of the persons liable for the excise tax to show the Department of Citrus, through competent evidence, proof of that part which is not subject to a taxable privilege. The citrus businesses claimed the exemption in Section 601.155(5) rendered the tax unconstitutionally discriminatory, in that processors who imported juice from foreign countries to be blended with Florida juice were subject to the equalization tax, whereas processors who imported juice from places such as California, Arizona and Texas enjoyed an exemption from the tax. The case, Tampa Juice Service, Inc., et al. v. Department of Citrus, Case No. GCG-00-3718 (Consolidated), was brought in the Tenth Judicial Circuit Court, in and for Polk County. Judge Dennis P. Maloney of that court continues to preside over that case. In a partial final declaratory judgment effective March 15, 2002, Judge Maloney found Section 601.155, Florida Statutes, unconstitutional because it violated the Commerce Clause of the United States Constitution due to its discriminatory effect in favor of non-Florida United States juice. In an order dated April 15, 2002, Judge Maloney severed the exemption in Section 601.155(5), Florida Statutes, from the remainder of the statute. The court's decision necessitated the formulation of a remedy for the injured plaintiffs. While the parties were briefing the issue before the court, the Florida Legislature met and passed Chapter 2002-26, Laws of Florida, which amended Section 601.155, Florida Statutes, to read as follows: Products made in whole or in part from citrus fruit on which an equivalent tax is levied pursuant to s. 601.15 are exempt from the tax imposed by this section. In the case of products made in part from citrus fruit exempt from the tax imposed by this section, it shall be the burden of the persons liable for the excise tax to show the Department of Citrus, through competent evidence, proof of that part which is not subject to a taxable privilege. Chapter 2002-26, Laws of Florida, was given an effective date of July 1, 2002. By order dated August 8, 2002, Judge Maloney set forth his decision as to the remedy for the plaintiffs injured by the discriminatory effect of Section 601.155(5), Florida Statutes. Judge Maloney expressly relied on the rationale set forth in Division of Alcoholic Beverages and Tobacco v. McKesson Corporation, 574 So. 2d 114 (Fla. 1991)("McKesson II"). In its initial McKesson decision, Division of Alcoholic Beverages and Tobacco v. McKesson Corporation, 524 So. 2d 1000 (Fla. 1988), the Florida Supreme Court affirmed a summary judgment ruling that Florida's alcoholic beverage tax scheme, which gave tax preferences and exemptions to certain alcoholic beverages made from Florida crops, unconstitutionally discriminated against interstate commerce. The Florida Supreme Court also affirmed that portion of the summary judgment giving the ruling prospective effect, thus denying the plaintiff a refund of taxes paid pursuant to the unconstitutional scheme. The decision was appealed to the United States Supreme Court. In McKesson Corporation v. Division of Alcoholic Beverages and Tobacco, 496 U.S. 18 (1990), the United States Supreme Court reversed the Florida Supreme Court's decision as to the prospective effect of its decision. The United States Supreme Court held that: The question before us is whether prospective relief, by itself, exhausts the requirements of federal law. The answer is no: If a State places a taxpayer under duress promptly to pay a tax when due and relegates him to a postpayment refund action in which he can challenge the tax's legality, the Due Process Clause of the Fourteenth Amendment obligates the State to provide meaningful backward-looking relief to rectify any unconstitutional deprivation. 496 U.S. at 31 (footnotes omitted). The United States Supreme Court set forth the following options by which the state could meet its obligation to provide "meaningful backward-looking relief:" [T]he State may cure the invalidity of the Liquor Tax by refunding to petitioner the difference between the tax it paid and the tax it would have been assessed were it extended the same rate reductions that its competitors actually received. . . . Alternatively, to the extent consistent with other constitutional restrictions, the State may assess and collect back taxes from petitioner's competitors who benefited from the rate reductions during the contested tax period, calibrating the retroactive assessment to create in hindsight a nondiscriminatory scheme. . . . Finally, a combination of a partial refund to petitioner and a partial retroactive assessment of tax increases on favored competitors, so long as the resultant tax actually assessed during the contested tax period reflects a scheme that does not discriminate against interstate commerce, would render petitioner's resultant deprivation lawful and therefore satisfy the Due Process Clause's requirement of a fully adequate postdeprivation procedure. 496 U.S. at 40-41 (citations and footnotes omitted). The United States Supreme Court expressly provided that the state has the option of choosing the form of relief it will grant. In keeping with the United States Supreme Court opinion, the Florida Supreme Court granted the Division of Alcoholic Beverages and Tobacco (the "Division") leave to advise the Court as to the form of relief the state wished to provide. The Division proposed to retroactively assess and collect taxes from those of McKesson's competitors who had benefited from the discriminatory tax scheme. McKesson contended that a refund of the taxes it had paid was the only clear and certain remedy, because retroactive taxation of its competitors would violate their due process rights. McKesson II, 574 So. 2d at 115. The Florida Supreme Court remanded the case to the trial court for further proceedings on McKesson's refund claim, with the following instructions: While McKesson may not necessarily be entitled to a refund, it is entitled to a "clear and certain remedy," as outlined in the Supreme Court's opinion. Because nonparties, such as amici, will be directly affected by the retroactive tax scheme proposed by the state, all affected by the proposed emergency rule must be given notice and an opportunity to intervene in this action. Therefore, on remand, the trial court not only must determine whether the state's proposal meets "the minimum federal requirements" outlined in the Supreme Court's opinion, it also must determine whether the proposal comports with federal and state protections afforded those against whom the proposed tax will be assessed. We emphasize that the state has the option of choosing the manner in which it will reformulate the alcoholic beverage tax during the contested period so that the resultant tax actually assessed during that period reflects a scheme which does not discriminate against interstate commerce. Therefore, if the trial court should rule that the state's proposal to retroactively assess and collect taxes from McKesson's competitors does not meet constitutional muster and such ruling is upheld on appeal, the state may offer an alternative remedy for the trial court's review. However, any such proposal likewise must satisfy the standards set forth by the Supreme Court as well as be consistent with other constitutional restrictions. 574 So. 2d at 116. In the instant case, Judge Maloney assessed the options prescribed by the series of McKesson cases and concluded that the only fair remedy was to assess and collect back assessments from those who benefited from the unconstitutional equalization tax exemption. His August 8, 2002 order directed the Department to "take appropriate steps, consistent with existing law, to assess and collect the Equalization tax from those entities which [benefited] from the unconstitutional exemption." On September 18, 2002, the Department promulgated the Emergency Rules at issue in DOAH Case No. 02-3648RE. The Emergency Rules were filed with the Department of State on September 24, 2002, and took effect on that date. They were published in the October 4, 2002 issue of the Florida Administrative Weekly (vol. 28, no. 40, pp. 4271-4272). The full text of the Emergency Rules is: EQUALIZATION TAX ON NON-FLORIDA UNITED STATES JUICE 20ER02-1 Intent. The Court in Tampa Juice Service, et al v. Florida Department of Citrus in Consolidated Case Number GCG-003718 (Circuit Court in and for Polk County, Florida) severed the exemption contained in Section 601.155(5), Florida Statutes, that provided an exemption for persons who exercised one of the enumerated Equalization Tax privileges on non-Florida, United States juice. The Court had previously determined that the stricken provisions operated in a manner that violated the Commerce Clause of the United States Constitution. On August 8, 2002, the Court ordered that the Florida Department of Citrus "take appropriate steps, consistent with existing law, to assess and collect the Equalization tax from those entities which [benefited] from the unconstitutional exemption." It is the Florida Department of Citrus' intent by promulgating the following remedial Rule 20ER02-01 and Chapter 20-15, F.A.C., to implement a non-discriminatory tax scheme, which does not impose a significant tax burden that is so harsh and oppressive as to transgress constitutional limitations. These rules shall be applicable to those previously favored persons who received favorable tax treatment under the statutory sections cited above. Specific Authority 601.02, 601.10, 601.15, 601.155 FS. Law Implemented 601.02, 601.10, 601.15, 601.155 FS. History-- New 9-24-02. 20ER02-2 Definitions. "Previously favored persons" shall be defined as any person who exercised an enumerated Equalization Tax privilege as defined by Section 601.155, Florida Statutes, but who was exempt from payment of the Equalization Tax due to the exemption for non-Florida, United States juice set forth in the statutory provision, which was ultimately determined to be unconstitutional and severed from Section 601.155(5), Florida Statutes. The "tax period" during which the severed provisions of Section 601.155(5), Florida Statutes, were in effect shall be defined as commencing on October 6, 1997, and ending on March 14, 2002. "Tax liability" shall be defined as the total amount of taxes due to the Florida Department of Citrus during the "tax period," at the following rates per box for each respective fiscal year: Fiscal Year Processed Rate Orange Grapefruit 1997-1998 .175 .30 1998-1999 .17 .30 1999-2000 .18 .325 2000-2001 .175 .30 2001-2002 .165 .18 Specific Authority 601.02, 601.10, 601.15, 601.155 FS. Law Implemented 601.02, 601.10, 601.15, 601.155 FS. History-- New 9-24-02. 20ER02-3 Collection. The Florida Department of Citrus shall calculate the tax liability for each person or entity that exercised an enumerated Equalization Tax privilege outlined in section 601.155, Florida Statutes, upon non-Florida, United States juice based upon inspection records maintained by Florida Department of Agriculture and Consumer Services and the United States Department of Agriculture. Additionally, the Florida Department of Citrus will provide notice of the calculation to the previously favored persons by certified mail. The notice of the calculation shall contain a statement including the following categories: (a) Tax liability; (b) Gallons; Brix; Type of product; (e) Total solids; (f) Conversion rate; (g) Total boxes; (h) Delineation of non-Florida, United States juice. (2)(a) Contained within the notice will be the various legal options available to those who previously enjoyed the exemption, set forth in proposed Rule 20- 15.003(2), F.A.C. (b) Persons who previously enjoyed the exemption may petition to intervene in the case of Tampa Juice Service, Inc., et al, Consolidated Case No. GCG-003718, presently pending before the Circuit Court of the Tenth Judicial Circuit in and for Polk County. A hearing to consider arguments made by any intervenor, the Plaintiffs and the Florida Department of Citrus is currently scheduled to be heard by the Honorable Dennis Maloney on November 12, 2002, in Bartow, Florida. (3) The Florida Department of Citrus will not oppose the timely intervention of persons who previously enjoyed the subject exemption that wish to present a claim to the Court in the Tampa Juice Service, Inc., et al v. Florida Department of Citrus. However, the Florida Department of Citrus does not waive any argument regarding the validity of the calculation of the tax liability or that imposition of this tax is constitutional. Specific Authority 601.02, 601.10, 601.15, 601.155 FS. Law Implemented 601.02, 601.10, 601.15, 601.155 FS. History-- New 9-24-02. The Department's "Specific Reasons for Finding an Immediate Danger to the Public Health, Safety or Welfare" were set forth as follows: On March 18, 2002, the Court in the Tenth Judicial Circuit, State of Florida, in and for Polk County, entered a Partial Final Declaratory Judgment in the case of Tampa Juice Service, Inc., et al v. Florida Department of Citrus, Consolidated Case Number GCG-003718. In this order the Court ruled that the exemption in Section 601.155, F.S., for non-Florida, United States juice was unconstitutional. On or about April 15, 2002, the Court severed the exemption for non-Florida, United States juice from section 601.155(5), F.S. On August 8, 2002, the Court held that the Florida Department of Citrus was required to cure the invalidity of the equalization taxing scheme. To cure this invalidity, the Florida Department of Citrus promulgates Rule 20ER02-1, F.A.C., which will serve to implement the Court's order for a nondiscriminatory tax scheme and provide due process protections for the previously favored taxpayers. These rules are being promulgated on an emergency basis to meet time constraints associated with litigation and to establish guidelines which protect the public's and state's interest for the orderly and efficient collection and payment of the tax liability. Without these guidelines, the welfare of the citizens and the state would be adversely affected because of the immediate and widespread impact of the failure of previously favored persons to properly remit the tax. The Department's "Reason for Concluding that the Procedure is Fair Under the Circumstances" was set forth as follows: Promulgation of these guidelines using the emergency rule procedures is the only available mechanism which adequately protects the public interests under the circumstances which require collection and payment of the tax liability. This procedure is fair to the public and to the previously favored persons. It permits promulgation of the necessary guidelines within a time frame which allows the industry to be adequately informed of their duties, responsibilities and rights with respect to the tax liability. In the November 15, 2002 issue of the Florida Administrative Weekly (vol. 28, no. 46, pp. 4996-4998), the Department published the Proposed Rules at issue in DOAH Case No. 02-4607RP. The text of Proposed Rule 20-15.001, Florida Administrative Code, is identical to that of Emergency Rule 20ER02-1, set forth above. The text of Proposed Rule 20-15.002, Florida Administrative Code, is identical to that of Emergency Rule 20ER02-2, set forth above. The text of Proposed Rule 20- 15.003(1)&(3), Florida Administrative Code, is identical to that of Emergency Rule 20ER02-3(1)&(3), set forth above. The text of Proposed Rule 15.003(2), Florida Administrative Code, varies from the text of Emergency Rule 20ER02-3(2), and reads as follows: 20-15.003 Collection. Subsequent to adoption of this rule, the Florida Department of Citrus will provide to the previously favored persons by certified mail a Notice of Tax Liability which shall contain a demand for payment consistent with the above-referenced itemized statement. The Department will deem late payment of Equalization Taxes owed by previously favored persons to constitute good cause, and shall waive the 5 percent penalty authorized by Section 601.155(10), F.S., as compliance with either of the following is established by Department [sic]: Lump sum payment of the tax liability remitted with the filing of Department of Citrus Form 4R (incorporated by reference in Rule 20-100.004, F.A.C.) for the relevant years and then-applicable tax rate(s) per subsection 20-15.002(3), F.A.C., within 61 days of receiving Notice of Tax Liability; or Equal installment payments remitted with the filing of Department of Citrus Form 4R (incorporated by reference in Rule 20-100.004, F.A.C.) for the relevant years and then-applicable tax rate(s) per subsection subsection [sic] 20-15.002(3), F.A.C., over a 60-month period, the first payment being due within 61 days of receiving Notice of Tax Liability pursuant to subsection 20-15.003(2), F.A.C.; or The Good Cause provisions of 601.155(10), F.S., shall not apply to persons who do not comply with paragraph 20- 15.003(2)(a), F.A.C., or paragraph 20- 15.003(2)(b), F.A.C. Failure to pay the taxes or penalties due under 601.155, F.S. and Chapter 20-15, F.A.C., shall constitute grounds for revocation or suspension of a previously favored person's citrus fruit dealer's license pursuant to 601.56(4), F.S., 601.64(6), F.S., 601.64(7), F.S., and/or 601.67(1), F.S. Peace River is a Florida corporation and licensed citrus fruit dealer regulated by Chapter 601, Florida Statutes. As such, Peace River is subject to the rules of the Department. Peace River buys, sells, and manufactures bulk citrus juices. By correspondence dated October 2, 2002, Peace River was notified by the Department that Peace River would be liable for payment of $86,242.41 in Equalization taxes for the tax period of October 6, 1997 through March 14, 2002 (the "tax period"), pursuant to the terms of the Emergency Rules. Fresh Juice is a Florida corporation and licensed citrus fruit dealer regulated by Chapter 601, Florida Statutes. As such, Fresh Juice is subject to the rules of the Department. Fresh Juice buys, sells, and manufactures citrus juices. By correspondence dated October 2, 2002, Fresh Juice was notified by the Department that Fresh Juice would be liable for payment of $45,052.19 in Equalization taxes for the tax period, pursuant to the terms of the Emergency Rules. Sun Orchard is a Florida corporation and licensed citrus fruit dealer regulated by Chapter 601, Florida Statutes. As such, Sun Orchard is subject to the rules of the Department. Sun Orchard buys, sells, and manufactures citrus juices. By correspondence dated October 2, 2002, Sun Orchard was notified by the Department that Sun Orchard would be liable for payment of $45,052.19 in Equalization taxes for the tax period, pursuant to the terms of the Emergency Rules. During the tax period, Peace River, Fresh Juice, and Sun Orchard imported, stored and blended non-Florida, United States citrus juices. Neither Peace River, Fresh Juice, nor Sun Orchard is a party to the lawsuit styled Tampa Juice Service, Inc., et al. v. Department of Citrus, Case No. GCG-00-3718 (Consolidated). Peace River, Fresh Juice, and Sun Orchard contend that they relied on the tax exemption in making business decisions and had no notice that their activities regarding non-Florida, United States juice would be taxable upon the court's striking of the exemption in Section 601.155(5), Florida Statutes. Accordingly, Peace River, Fresh Juice, and Sun Orchard contend that, during the tax period, they had no opportunity to conform their conduct to avoid the tax or position themselves to claim a refund allowed by Section 601.155, Florida Statutes. Peace River, Fresh Juice, and Sun Orchard contend that they have not been obligated by Chapter 601, Florida Statutes, to keep specific records on their use of non-Florida United States citrus juices for the tax period, but admit they keep business records required by law, which may include some business records related to non-Florida United States juice during the tax period. Peace River, Fresh Juice, and Sun Orchard shipped products made with non-Florida, United States juice during the tax period without payment of the Equalization Tax.
The Issue Whether the Respondent Carlyn R. Kulick, d/b/a Carlyn's, failed to pay amounts owing to the Petitioner for the shipment of citrus fruit, as set forth in the Complaint dated April 30, 2001, and, if so, the amount the Petitioner is entitled to recover.
Findings Of Fact At all times material to this proceeding, Spyke's Grove and Carlyn's were "citrus fruit dealers" licensed by the Department. As part of its business, Carlyn's sells to its retail customers "gift fruit" consisting of oranges and grapefruit for shipment to third persons identified by the customers. Carlyn R. Kulick is the owner of Carlyn's and acted on its behalf with respect to the transactions that are the subject of this proceeding. Spyke's Grove is in the business of packaging and shipping "gift fruit" consisting of oranges and grapefruit pursuant to orders placed by other citrus fruit dealers. Barbara Spiece is the president of Spyke's Grove and acted on its behalf with respect to the transactions that are the subject of this proceeding. In November and December 1999, Spyke's Grove received a number of orders for "gift fruit" from Carlyn's. Most of the orders were for single shipments of fruit. One order was for six monthly shipments of fruit. This was the first year Carlyn's had done business with Spyke's Grove, and Carlyn's and Spyke's Grove did not execute a written contract governing their business relationship. On the night of Sunday, December 12, 1999, the Spyke's Grove's packinghouse was destroyed by fire, and its offices were substantially damaged. The fire could not have happened at a worse time because it was at the peak of the holiday fruit- shipping season. Spyke's Grove was able to move into temporary offices and to obtain the use of another packinghouse very quickly. It had telephone service at approximately noon on Tuesday, December 14, 1999, and it began shipping "gift fruit" packages on Friday, December 17, 1999, to fill the orders it had received. Carlyn R. Kulick, the owner of Carlyn's, learned of the fire at Spyke's Grove and attempted to contact the Spyke's Grove offices for an update on the orders Carlyn's had placed for shipment during the holidays. Mr. Kulick was unable to contact anyone at Spyke's Grove for three or four days after the fire, and he was worried that his customers' orders for "gift fruit" would not be shipped on time. Mr. Kulick called another packinghouse and placed orders duplicating some of the orders Carlyn's had placed with Spyke's Grove. Meanwhile, Spyke's Grove was giving priority to its smaller wholesale customers such as Carlyn's, and it shipped all of the orders it had received from Carlyn's. Carlyn's did not cancel its orders with Spyke's Grove or otherwise notify Spyke's Grove that it should not ship the fruit; Mr. Kulick assumed that Spyke's Grove would contact him if it intended to ship the fruit ordered by Carlyn's. Spyke's Grove sent numerous invoices and statements of account to Carlyn's Regarding the gift fruit at issue here. According to the statement of account dated June 1, 2001, as of that date Carlyn's owed Spyke's Grove $1,069.78 for the gift fruit at issue here. Most of the invoices to Carlyn's that were submitted by Spyke's Grove contain the following: "Terms: Net 14 days prompt payment is expected and appreciated. A 1½% monthly service charge (A.P.R. 18% per annum) may be charged on all past due accounts. . . ." Relying on this language, Spyke's Grove also seeks to recover a monthly service charge for each month that Carlyn's account was past due. Carlyn's does not dispute Spyke's Grove's claim that $1,069.78 worth of "gift fruit" was shipped by Spyke's Grove pursuant to orders Carlyn's placed in November and December 1999. Carlyn's' basic position is that it need not pay Spyke's Grove for the fruit because Spyke's Grove did not notify it after the December 12, 1999, fire that it would ship the orders and because Carlyn's had to make sure that its customers' orders were filled. The uncontroverted evidence establishes that Carlyn's was, at the times material to this proceeding, a Florida- licensed and bonded citrus fruit dealer; that, in November and December 1999, Carlyn's submitted orders to Spyke's Grove for the shipment of "gift fruit" consisting of oranges and grapefruit; that Spyke's Grove shipped all of the "gift fruit" ordered by Carlyn's in November and December 1999; that the price of the "gift fruit" shipped by Spyke's Grove pursuant to Carlyn's' orders totaled $1,069.78; and that Spyke's Grove timely filed its complaint alleging that Carlyn's failed to promptly pay its indebtedness to Spyke's Grove for citrus products shipped pursuant to orders placed by Carlyn's. Spyke's Grove is, therefore, entitled to payment of the principal amount of $1,069.78, plus pre-judgment interest. Based on the date of the last invoice which contained a charge for any of the gift fruit at issue here, the prehearing interest would run from May 1, 2000.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order ordering Carlyn R. Kulick, d/b/a Carlyn's, to pay $1,069.78 to Spyke's Grove, Inc., d/b/a Fresh Fruit Express, Emerald Estate, Nature's Classic, together with pre-judgment interest calculated at the rate specified in Section 55.03, Florida Statutes, on the amounts owing. DONE AND ENTERED this 1st day of November, 2001, in Tallahassee, Leon County, Florida. MICHAEL M. PARRISH 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 1st day of November, 2001. COPIES FURNISHED: Carlyn R. Kulick, Owner Carlyn's 1601 Fifth Avenue, North St. Petersburg, Florida 33713 Barbara Spiece, President Spyke's Grove, Inc. 7250 Griffin Road Davie, Florida 33314 Western Surety Company Post Office Box 5077 Sioux Falls, South Dakota 57117 Honorable Charles H. Bronson Commissioner of Agriculture Department of Agriculture and Consumer Services The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810 Richard D. Tritschler, General Counsel Department of Agriculture and Consumer Services The Capitol, Plaza Level 10 Tallahassee, Florida 32399-0810 Brenda D. Hyatt, Bureau Chief Bureau of License and Bond Department of Agriculture and Consumer Services 541 East Tennessee Street India Building Tallahassee, Florida 32308
Findings Of Fact Petitioner, Deerfield Groves Company (Deerfield), is a licensed citrus fruit dealer under Chapter 601, Florida Statutes, and Chapter 20-34, Florida Administrative Code. As a licensee, Deerfield is subject to administrative and criminal prosecution for violation of the statutes and rules governing licensed citrus fruit dealers and was under administrative prosecution for alleged violations of Section 601.33, Florida Statutes, and Rule 20-34.11, Florida Administrative Code, at the time of the final hearing. Deerfield has legal standing as a party petitioner in this case. Respondent, Department Of Citrus (DOC), promulgated Rule 20-34.11, Florida Administrative Code, under the authority of Section 601.10, Florida Statutes. Rule 20-34.11 is designed to implement Section 601.33, Florida Statutes. Respondent, Department Of Agriculture And Consumer Services, (DACS), is the agency charged with the duty to enforce Section 601.33, Florida Statutes, and Rule 20- 34.11, Florida Administrative Code. Personnel of DACS' Division Of Fruit And Vegetable Inspection also are responsible for testing fresh citrus for maturity under Chapter 20-34, Florida Administrative Code. Licensees such as Deerfield furnish a testing room for DACS inspectors to perform maturity tests and certify fresh citrus, as required for marketing fresh fruit. DACS leases an extractor, used for squeezing juice from fruit samples, and subleases the extractor to the licensee. Under the sublease, the extractor is kept in the testing room for use by DACS inspectors and, when not being used by DACS inspectors, for use by the licensee in performing its own tests. Typically, the licensee furnishes the testing room with a table for two and a chair or two. When DACS inspectors perform maturity tests at the beginning of the early harvest, they bring most of the things they need for testing. The licensee provides the bins in which the fruit samples are carried into the testing room. The inspectors bring either a DACS slicing knife or their own. The licensee provides buckets it owns for use by the inspector during the test to collect juice extracted from fruit samples. The DACS inspectors also bring: a sizer to measure the fruit samples; a 2000 c.c. graduated cylinder to measure juice quantities; a 500 c.c. graduated cylinder to hold juice being tested for solids content and for temperature; aluminum pans to hold the graduated cylinders; a combination hydrometer for measuring juice solids content and temperature; a 25 m.1. pipet for transferring a measured amount of juice into a flask; the flask; a bottle of phenothaline with eyedropper top used for adding measured amounts of phenothaline to the flask of measured juice; a bottle of alkaline solution; and a burette for adding a measured amount of the alkaline solution to the flask of measured juice. During the harvest season, DACS leaves its equipment, instruments and solutions referred to in the preceding paragraph in the testing room. They are kept separate from the licensee's property and are not supposed to be used by the licensee. However, DACS allows the licensee to use its own bins and buckets and the extractor to conduct its own tests in the testing room when DACS inspectors are not using it. 1/ Some DACS inspectors request or allow licensees to assist during testing or to handle the fruit samples. 2/ Some allow licensees to attempt to influence the inspector's judgment by questioning the validity of the test or the accuracy of the inspector's observations or by comparing the inspector's results with the results of its own tests. Sometimes, this results in correction of an error the inspector otherwise would have made. It was not proved, however that there is an agency policy of requesting or allowing licensees to conduct themselves in those ways during testing. DACS has a policy to allow only one licensee representative in the testing room with the DACS inspector during testing. Violation of this policy is viewed as a violation of Section 601.33, Florida Statutes (1983). However, not all DACS inspectors strictly enforce this policy. Some allow more than one licensee representative in the testing room.
The Issue The issues for determination in this case are whether Respondent, as a licensed citrus fruit dealer, breached an agreement with Petitioner relating to the purchase of citrus fruit during the 1993-1994 citrus shipping season; and further whether the breach of such agreement constitutes a violation of the Florida Citrus Code for which the proceeds of the citrus fruit dealer's bond executed by Co-Respondent should be paid to Petititioner pursuant to Section 601.66, Florida Statutes.
Findings Of Fact Petitioner, BBC & F Corporation, Inc., is a Florida corporation located in Zolfo Springs, Florida, which is in the business of buying and selling citrus fruit. Charles J. "Chuck" Young is the vice-president and a director of Petitioner. Respondent, Jim Robinette, is a citrus fruit dealer with an office in Lakeland, Florida, who was licensed during the 1993-1994 citrus shipping season by the Florida Department of Agriculture and Consumer Affairs. Co-Respondent, Aetna Casualty and Surety Company, is a surety company qualified to do business in Florida, which pursuant to Section 601.61, Florida statutes, executed Respondent's citrus fruit dealer's bond for the 1993-1994 citrus shipping season in the amount of $5,000.00. On or about March 1, 1994, Petitioner, by and through its director and representative, Charles J. "Chuck" Young, entered into an oral contract with Respondent for the sale and delivery of certain citrus fruit from Petitioner's grove in Dundee, Florida. At that time, Respondent had made a prior agreement with the Redi-Made Foods Corporation to supply citrus fruit to Redi-Made's facility in Tampa, Florida. Specifically, the contract between Petitioner and Respondent provided for the purchase of valencia oranges to be used as salad fruit. The fruit was to be delivered by Petitioner to Redi-Made's facility in Tampa, Florida. The initial terms of the contract provided for a purchase price of $10 per box for fruit delivered to Redi-Made. Of the $10 contract price, $7 was for the grower (Petitioner), $1.90 was to cover the harvesting costs, $.25 was a brokerage fee paid to James Porter of Redi-Made, and $.85 was for Respondent. The first few loads were delivered to Redi-Made and paid for at the contract price of $10 per box. Subsequent to the delivery of the initial few loads, the terms of the contract were amended to incorporate a deduction of $.20 per box of fruit delivered for the purpose of expediting the processing of the payments from Redi-Made. The Petitioner and Respondent agreed to share equally this reduction from the original price. Accordingly, under the amended terms of the contract, Petitioner would receive $6.90 per box delivered, the harvesting costs remained at $1.90 per box delivered, the payment to James Porter remained at $.25 per box delivered, and the Respondent would receive $.75 per box delivered. In accordance with the terms of the amended contract, Petitioner during March of 1994, delivered six loads of valencia oranges totalling 2210 boxes to Redi-Made for which payment has not been made by Respondent. Under the terms of the amended contract, Petitioner is owed $15,249 for the fruit delivered. In addition, Petitioner paid for the harvesting costs of the fruit, for which under the terms of the amended contract, Petitioner is owed $4,199. Respondent was paid by Redi-Made for three of the six loads. These loads are evidenced by trip tickets 70144, 70146 and 82960, and show that 930 boxes of fruit were delivered by Petitioner to Redi-Made; however, Redi-Made paid Respondent for only 890 boxes of this fruit, and did not pay Respondent for the remainder of the 2210 boxes of fruit delivered by Petitioner. There is an ongoing dispute between Respondent and Redi-Made regarding Redi-Made's failure to make payment for the remainder of the fruit; however, resolution of the Respondent's dispute with Redi-Made is independent of, and does not affect the obligations of the Respondent with respect to Respondent's contract with Petitioner.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Agriculture and Consumer Services enter a final order adjudicating that the amount of indebtedness owed to Petitioner from Respondent is $19,488.00, that Respondent shall have thirty (30) days in which to satisfy such indebtedness, and that upon failure of the Respondent to make satisfaction of this claim, the proceeds of the citrus fruit dealer's bond executed by Co-Respondent shall be distributed to Petitioner. RECOMMENDED in Tallahassee, Leon County, Florida, this 9th day of May, 1995. RICHARD HIXSON 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 9th day of May, 1995. APPENDIX Petitioner's Findings 1.-3. Adopted and Incorporated COPIES FURNISHED: Commissioner Bob Crawford Commissioner of Agriculture The Capitol, P1-10 Tallahassee, Florida 32399-0810 Brenda Hyatt, Chief Department of Agriculture and Consumer Services Mayo Building, Room 508 Tallahassee, Florida 32399-0800 Richard Tritschler, Esquire Department of Agriculture and Consumer Services The Capitol, PL-10 Tallahassee, Florida 32399-0810 Allan L. Casey, Esquire Post Office Box 7146 Winter Haven, Florida 33883-7146 Jim Robinette 2025 Sylvester Road, Suite J4 Lakeland, Florida 33803
The Issue The issues concern the complaint by Petitioner against Respondents for the alleged failure to pay for $125.00 worth of medium zucchini squash also referred to as medium green squash. See Sections 604.15 through 604.30, Florida Statutes.
Findings Of Fact Petitioner sells produce. East Coast purchases produce and resells that produce at wholesale. The transaction which is in dispute here concerns an April 25, 1990 sale of medium zucchini squash. On that date Jerry B. Portnoy, Vice President for East Coast who runs the day to day operations of the company and buys produce spoke with Petitioner. In that conversation, which took place early in the morning, Petitioner stated that he had the squash to sell. Portnoy told Petitioner that he had plenty of that form of produce on hand. Petitioner stated that this was the last picking and that he would give Portnoy a good price. The price that Petitioner mentioned was $2.50 a crate. Mr. Portnoy said that he could use about 100 crates and he reiterated that he had plenty of that type of produce on hand. That comment by Mr. Portnoy met with the remark by Petitioner which was to the effect, that there might be a few additional crates above the 100 discussed. Portnoy said that he did not need any more than 100 crates in that he had plenty of that produce on hand. As Portnoy described at hearing, he felt that he really did not even need 100 crates; however, based upon the past working relationship between the Petitioner and Portnoy he agreed to take 100 crates. Contrary to the agreement between Portnoy and the Petitioner, sometime on the evening of April 25, 1990, Petitioner delivered 236 crates of the squash. No one was at East Coast at its Jacksonville, Florida business location to receive the squash and inspect them. East Coast would not have accepted 236 crates that were delivered if it had known of that number of crates. No one was available to inspect the squash until the following morning. On April 26, 1990, Mr. Portnoy examined the squash and found that some of the product was inferior and was in a state of decay. As a consequence, Mr. Portnoy called the Petitioner on the telephone on that morning and told the Petitioner that the Petitioner had sent too many crates and some of the squash were bad. Nonetheless, Mr. Portnoy told Petitioner that he would work it out as best he could, meaning that he would sell as much of the product as possible. During contact with the Petitioner on the part of East Coast, Petitioner did not ask for a federal inspection. East Coast was able to sell all but 50 crates of the squash as delivered. It submitted payment in the amount of $465 as reflected on the face of the invoice which Petitioner sent to East Coast. That exhibit is Respondent's Exhibit No. 1, admitted into evidence. It reflects that 50 crates were dumped which had they been sold would have been worth $125.00. It is that $125.00 which is in dispute. Mr. Portnoy called the Petitioner after the squash had been sold. That call took place a couple of weeks later. In the course of this conversation the Petitioner said that he did not want to hear about problems anymore and that he wanted to be paid for the full amount of all crates delivered. Mr. Portnoy said that 50 crates had been lost and that the amount being remitted through a check would relate only to those crates that had been sold. This describes the amount remitted on June 15, 1990 set out in Respondent's Exhibit No. 1. Petitioner replied that he did not know if he would cash the check or not. Mr. Portnoy said that the check in the amount of $465.00 was for payment in full. This concluded their business until the time of the complaint filed by the Petitioner. On that facts as reported, there was no agreement to sell more than 100 crates. The additional crates that were sold by East Coast was a gratuitous gesture on the part of East Coast for which Petitioner was paid the full amount. The 50 crates that were not paid for contained inferior products for which Petitioner was not entitled to payment. This speaks to the 50 crates that were dumped which had they been sold would have been worth $125.00.
Recommendation Based upon the consideration of the facts found and the conclusions of law, it is recommended that a Final Order be entered which dismisses the complaint of the Petitioner and relieves the Respondents of any financial obligation to pay the contested $125.00 claim. RECOMMENDED this 8th day of April, 1991, in Tallahassee, Florida. CHARLES C. ADAMS, 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 8th day of April, 1991. COPIES FURNISHED: David Browning c/o David Browning Wholesale Produce 234 Church Street Starke, FL 32091 East Coast Fruit Company Jerry Portnoy, Vice President Post Office Box 2547 Jacksonville, FL 32203 James W. Sears, Esquire 511 North Ferncreek Avenue Orlando, FL 32803 Clinton H. Coulter, Jr., Esquire Department of Agriculture and Consumer Services Mayo Building Tallahassee, FL 32399-0800 Bob Crawford, Commissioner Department of Agriculture and Consumer Services The Capitol, PL-10 Tallahassee, FL 32399-0810
The Issue Whether Respondent A & J Pak Ship, Inc., owes Petitioner $551.16 for "gift fruit,” as alleged in Petitioner's Complaint.
Findings Of Fact Based upon the evidence adduced at the final hearing and the record as a whole, the following findings of fact are made: At all times material to the instant case, Petitioner and A & J have been licensed by the Department of Citrus as "citrus fruit dealers." As part of its operations, A & J sells "gift fruit" to retail customers. The "gift fruit" consists of oranges or grapefruits, or both, that are packaged and sent to third parties identified by the customers. In November and December of 1999, A & J took orders for "gift fruit" from retail customers that it contracted with Petitioner (doing business as Fresh Fruit Express) to fill. Under the agreement between A & J and Petitioner (which was not reduced to writing), it was Petitioner's obligation to make sure that the "gift fruit" specified in each order was delivered, in an appropriate package, to the person or business identified in the order as the intended recipient at the particular address indicated in the order. Among the intended recipients identified in the orders that Petitioner agreed to fill were: the Uthe family, the Weckbachs, Mr. and Mrs. T. Martin, Angelo's, Susan Booth, Mr. and Mrs. E. Coello, Mr. and Mrs. Dalbey, Carol Baker and family, the Tarvin family, Shelly and Mark Koontz, Pamela McGuffey, Jerome Melrose, Russell Oberer, Mrs. Josephine Scelfo, Curt and Becky Tarvin, Heidi Wiseman, Kay and Artie Witt, and the William Woodard family, who collectively will be referred to hereinafter as the "Intended Recipients in Question." A & J agreed to pay Petitioner a total of $438.18 to provide "gift fruit" to the Intended Recipients in Question, broken down as follows: $21.70 for the Uthe family order, $21.70 for the Weckbachs order, $22.82 for the Mr. and Mrs. T. Martin order, $27.09 for the Angelo's order, $21.70 for the Susan Booth order, $31.67 for the Mr. and Mrs. E. Coello order, $17.50 for the Mr. and Mrs. Dalbey order, $21.70 for the Carol Baker and family order, $27.09 for the Tarvin family order, $21.70 for the Shelly and Mark Koontz order, $21.70 for the Pamela McGuffey order, $32.44 for the Jerome Melrose order, $21.70 for the Russell Oberer order, $17.60 for the Mrs. Josephine Scelfo order, $21.70 for the Curt and Becky Tarvin order, $17.50 for the Heidi Wiseman order, $17.50 for the Kay and Artie Witt order, and $31.67 for the William Woodard family order. All of these orders, which will be referred to hereinafter as the "Intended Recipients in Question 'gift fruit' orders," were to be delivered, under the agreement between A & J and Petitioner, by Christmas day, 1999. On Sunday night, December 12, 1999, fire destroyed Petitioner's packing house and did considerable damage to Petitioner's offices. With the help of others in the community, Petitioner was able to obtain other space to house its offices and packing house operations. By around noon on Tuesday, December 14, 1999, Petitioner again had telephone service, and by Friday, December 17, 1999, it resumed shipping fruit. Scott Wiley, A & J's President, who had learned of the fire and had been unsuccessful in his previous attempts to contact Petitioner, was finally able to reach Petitioner by telephone on Monday, December 20, 1999. After asking about the status of the Intended Recipients in Question “gift fruit” orders and being told by the employee with whom he was speaking that she was unable to tell him whether or not these orders had been shipped, Mr. Wiley advised the employee that A & J was "cancelling" all "gift fruit" orders that had not been shipped prior to the fire. Mr. Wiley followed up this telephone conversation by sending, that same day, the following facsimile transmission to Petitioner: As per our conversation on 12-20-99, please cancel all orders sent to you from A & J Pak-Ship (Fresh Fruit Express). After trying to contact your company numerous times on December 13, I called the Davie Police Department, who [sic] informed me that you had experienced a major fire. I tried to contact you daily the entire week with no luck. Since I had no way to contact you, it was your responsibility to contact me with information about your business status. Without that contact, I had to assume that you were unable to continue doing business. With Christmas fast approaching and with no contact from anyone on your end, I had no choice but to begin to issue refunds. While I understand the fire was devastating for you, understand that my fruit business is ruined, and will take years to reestablish. Please note that I will not pay for any orders shipped past the date of your fire, 12-13-99, as I have already issued refunds, and I will need proof of delivery for all those orders delivered before the fire. Again, cancel all orders including the remainder of multi-month packages, and honeybell orders. Your lack of communication has put me in a very bad situation with my customers. One short phone call to me could have avoided all this difficulty. Had I not tried your phone on 12-20, I would still have no information from you. Petitioner did not contact Mr. Wiley and tell him about the fire because it did not think that the fire would hamper its ability to fulfill its obligations under its agreement with A & J. By the time Mr. Wiley made telephone contact with Petitioner on Monday, December 20, 1999, Petitioner had already shipped (that is, placed in the possession of a carrier and made arrangements for the delivery of) all of the Intended Recipients in Question "gift fruit" orders (although it had not notified A & J it had done so). Petitioner did not ship any A & J "gift fruit" orders after receiving Mr. Wiley's December 20, 1999, telephone call. On or about February 18, 2000, Petitioner sent A & J an invoice requesting payment for "gift fruit" orders it had shipped for A & J. Among the orders on the invoice for which Petitioner was seeking payment were the Intended Recipients in Question "gift fruit" orders (for which Petitioner was seeking $438.18). The invoice erroneously reflected that all of these orders had been shipped on December 25, 1999. They, in fact, had been shipped on December 18, 1999, or earlier. 1/ Mr. Wiley, acting on behalf of A & J, wrote a check in the amount of $858.26, covering all of the invoiced orders except the Intended Recipients in Question "gift fruit" orders, and sent it to Petitioner, along with the following letter dated February 22, 1999: As per my conversation on 12/20/90 at 11:20 a.m. with Yvette we cancelled all orders shipped after the fire, and also followed up with a certified letter. We had to reorder all of those orders and also refunded a lot of orders as they were not there in time for Xmas as all orders are required to arrive before Xmas. As I said in my certified letter to you it was a[n] unfortunate fire but all you had to do was to inform me what was going on and we could have worked something out. Our fruit business has been ruined by this incident, and quite possibly our entire company. It is unbelievable that more than sixty days after the fire we still have had no correspondence from you whatsoever. We have deducted those orders that were cancelled and arrived well after Xmas and remitted the remainder. A & J has not yet paid Petitioner the $438.18 for the Intended Recipients in Question "gift fruit" orders.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Department enter a final order dismissing Petitioner’s Complaint. DONE AND ENTERED this 12th day of September, 2001, in Tallahassee, Leon County, Florida. STUART M. LERNER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 12th day of September, 2001.
The Issue The issue in this case is whether Respondent owes Petitioner money on a citrus contract and, if so, how much.
Findings Of Fact Petitioner owns citrus groves in Wauchula and one is near Zolfo Springs. Due to its proximity to a homesite, the latter grove is called the homeplace grove. Respondent operates a citrus packinghouse and a small retail outlet for citrus. On October 7, 1994, Petitioner and Respondent entered into a contract under which Petitioner agreed to sell to Respondent naval oranges at the price of $6 per box on the tree. Petitioner insisted on the contract and supplied the form. The contract states that the fruit "will be picked by Dec. 20, 1994." This is handwritten in the blank space for quantity of fruit. Elsewhere the contract provides a space for a completion date for picking, but this space is left blank. The contract adds: "However, notwithstanding the foregoing provision, Buyer, at its sole discretion[,] shall determine the dates and times for accomplishing the picking, loading, or hauling of said fruit." The contract notes that there are an estimated 3000 boxes at the Wauchula grove and an estimated 500 boxes at the homeplace grove. The contract states: Buyer shall only be required hereunder to accept delivery of the estimated quantity of fruit set forth herein; however, Buyer may, at its sole option, elect to accept delivery of all fruit grown or being grown at the grove locations described above at the prices specified herein. After signing the contract, the price of navel oranges dropped considerably. Also, Respondent had been relying on a third party to purchase much of the fruit from him, but the third party did not do so. Through December 9, 1994, Respondent took delivery on 1662 boxes of navel oranges. Petitioner picked the first 820 boxes, for which Respondent paid an additional, agreed-upon $2 per box. Respondent picked the remainder of the 1662 boxes, for which Respondent paid $11,612, pursuant to the contract. Petitioner became increasingly concerned with Respondent's slow progress. They agreed to reduce the price to $5 per box for 60 boxes picked on December 13, 1994, and then $4 per box for 360 boxes picked after the December 20 picking date stated in the contract. Pursuant to their new agreement, Respondent paid $300 for the 60 boxes picked on December 13, 1994, and $1440 for the remaining 360 boxes picked between December 27, 1994, and January 11, 1995. Believing that Respondent was obligated to take the entire output from the two groves, which proved to be a total of 4232 boxes, Petitioner's principal concluded that Respondent could not meet its contractual obligations. Without notice to Respondent, Petitioner agreed with Mt. Dora Growers Cooperative to pick the remaining fruit. The growers coop picked 920 boxes on January 11, 1995, 900 boxes on January 12, 1995, and 330 boxes on January 16, 1995. For a total of 2150 boxes, the growers coop paid Petitioner $498.84, or $0.23 per box. Petitioner had better luck with the homeplace oranges. By contract dated January 24, 1995, again without notice to Respondent, Petitioner sold 500 boxes of navel oranges to Keith Watson, Inc. for $2 per box. Respondent took delivery of 1220 boxes in October, 122 boxes in November, 320 boxes through December 9, 380 boxes at reduced prices for the rest of December, and 40 boxes in the first 11 days of January. This declining trend suggests problems. However, this fact alone does not prove an anticipatory breach by Respondent. Nothing in the record establishes Respondent's intent to repudiate the contract. There was still time for Respondent or, more likely, a third party to pick the remaining boxes for which Respondent was liable (1418). The growers coop removed 1820 boxes in two days. Also, the price and urgency of the growers coop sale are undermined by the sale two weeks later of 500 boxes at $2 per box.
Recommendation It is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order dismissing the complaint. ENTERED on July 7, 1995, in Tallahassee, Florida. ROBERT E. MEALE 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 on July 7, 1995. COPIES FURNISHED: W. Ralph Durrance, Jr. P.O. Box 5647 Lakeland, FL 33807-5647 Gary Whidden Whidden Citrus & Packinghouse, Inc. 396 Country Road 630A Frostproof, FL 33843 Florida Farm Bureau General Insurance Company P.O. Box 147030 Gainesville, FL 32614-7030 Hon. Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, FL 32399-0810 Richard Tritschler, General Counsel Department of Agriculture The Capitol, PL-10 Tallahassee, FL 32399-0810 Brenda Hyatt, Chief Bureau of Licensing and Bond Department of Agriculture 508 Mayo Building Tallahassee, FL 32399-0800
