The Issue The issues in this case are whether the allegations of the Amended Administrative Complaint are correct, and, if so, what penalty should be imposed.
Findings Of Fact At all times material to this case, the Respondent was a certified residential real estate appraiser, holding Florida license number RD3233. At all times material to this case, James Berry was a registered real estate appraiser trainee, holding Florida license number RI16607. Mr. Berry was in training with the Respondent, who was his supervisory appraiser. On December 11, 2006, the Respondent and Mr. Berry issued an appraisal report for residential property located at 9602 Whilehall Street, Naples, Florida, 34109, the "subject property." Mr. Berry conducted the appraisal and prepared the computer-generated appraisal report. He thereafter affixed his digital signature to the report as the appraiser. The Respondent reviewed Mr. Berry's appraisal and thereafter affixed his digital signature to the report as the supervisory appraiser. The appraisal report was on a form designated as "Freddie Mac Form 70, March 2005" and "Fannie Mae Form 1004, March 2005." Beginning on page five and continuing onto page six of the form was an "appraiser's certification." Included within the appraiser's certification was a statement that the appraiser "performed a complete visual inspection of the interior and exterior areas of the subject property." Page six of the form included a "supervisory appraiser's certification." The supervisory appraiser's certification did not state that the supervisory appraiser conducted a visual inspection of the property. The lower part of page six contained a boxed portion containing separate parts that were divided only by space between blocks of text. On the left side of the boxed portion was a part titled "APPRAISER" that included the appraiser's name, license number, company name and address, and appraisal date. It also included the appraiser's digital signature and the date of signature. Below the appraiser's information was a part titled "ADDRESS OF PROPERTY APPRAISED" that included the address and valuation of the subject property. Below the part titled "ADDRESS OF PROPERTY APPRAISED" was a part titled "LENDER/CLIENT" that included the relevant information. On the right side of the boxed portion was a part titled "SUPERVISORY APPRAISER (ONLY IF REQUIRED)" that included the supervisory appraiser's name, license number, company name and address, the supervisory appraiser's digital signature, and the date of signature. Below the part titled "SUPERVISORY APPRAISER (ONLY IF REQUIRED)" was a part titled "SUBJECT PROPERTY," which included the following boxes and text: Did not inspect subject property Did inspect exterior of subject property from street Date of Inspection Did inspect interior and exterior of subject property Date of Inspection Below the part titled "SUBJECT PROPERTY" was a part titled "COMPARABLE SALES," which included the following boxes and text: Did not inspect exterior of comparable sales from street Did inspect exterior of comparable sales from street Date of Inspection The appraisal form contained no instructions to specifically indicate whether the appraiser or the supervisory appraiser was responsible for completing the "SUBJECT PROPERTY" part. Mr. Berry had performed the interior and exterior inspection of the subject property. In completing the form on the computer, Mr. Berry checked the box within the "SUBJECT PROPERTY" part indicating that the interior and exterior of the property had been inspected. The Respondent did not inspect the interior and exterior of the subject property. The evidence is insufficient to establish that either Mr. Berry or the Respondent knew that the supervisory appraiser was apparently responsible for completing the "SUBJECT PROPERTY" part of the boxed section. The Petitioner asserted that the client for the appraiser at issue in this proceeding ("Landwatch/Countryside") required that a supervisory appraiser perform an interior and exterior inspection of the subject property. The assertion was not supported by credible evidence and is rejected.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Real Estate, enter a final order finding Frank LaPlatte in violation of one count of Subsection 475.624(14), Florida Statutes (2006), and imposing an administrative fine of $2,500 and a six-month suspension, during which an appropriate USPAP course must be completed, followed by a three-year period of probation. DONE AND ENTERED this 17th day of February, 2009, in Tallahassee, Leon County, Florida. S WILLIAM F. QUATTLEBAUM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 17th day of February, 2009. COPIES FURNISHED: Robert Minarcin, Esquire Department of Business and Professional Regulation 400 West Robinson Street, Suite 801N Orlando, Florida 32801-1757 David F. Garber, Esquire Garber, Hooley & Holloway, LLP 700 Eleventh Street South, Suite 202 Naples, Florida 34102 Ned Luczynski, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Thomas W. O'Bryant, Jr., Director Division of Real Estate Department of Business and Professional Regulation 400 West Robinson Street, Suite 802N Orlando, Florida 32801
The Issue The issues presented are whether Respondent reviewed the appraisal report of an assistant appraiser in a manner that departed from the standards of care in Subsections 475.624(14), and (15), Florida Statutes (2001); and, if so, what penalty should be imposed against Respondent's professional license.
Findings Of Fact Petitioner is the state agency authorized to regulate certified general real estate appraisers (appraisers) and assistant appraisers pursuant to Chapter 475, Part II, Florida Statutes (2001). Respondent and Ms. Deborah Hall are certified appraisers pursuant to certificate numbers RZ-1589 and RD-4615. On April 5, 2002, Respondent operated an appraisal business located at 1727 Coachman Plaza Drive, Clearwater, Florida. Respondent supervised approximately 14 assistant appraisers, including Ms. Hall.1 Ms. Hall was certified as an assistant appraiser pursuant to certification number RI-5557.2 Ms. Hall developed a written appraisal report for residential real estate located at 7415 Flounder Drive, Hudson, Florida. Respondent reviewed the appraisal report and cosigned it with Ms. Hall before she communicated it to the client. The appraisal report complied with all applicable standards of practice except one. The appraisal report included incorrect values for three comparable properties. The correct closing prices of the three comparables were $73,000, $74,000, and $82,000. The appraisal report included erroneous closing prices of $110,000, $116,000, and $110,000; and inadvertently inflated the appraised value. Omission of the comparable values from the appraisal report was a substantial error. The error significantly affected the appraisal according to statutorily adopted Uniform Standards of Professional Appraisal Practice, Appraisal Standards Board, The Appraisal Foundation, 2002 ed. (USPAP), Standards Rule 1-1(b), at page 15. (The terms USPAP and "appraisal standards" are used synonymously and the abbreviation "SR" refers to a specific Standards Rule, such as SR 1-1(b)).3 The "workfile" developed by Ms. Hall contained the correct closing price for each comparable. The term "workfile" is defined in USPAP, Definitions, at page 5. A workfile consists of the "documentation necessary to support an appraiser's analysis, opinions, and conclusions."4 The omission of the correct comparable values from the appraisal report could not be discovered without reviewing the "workfile" developed by Ms. Hall. It is undisputed that Respondent did not include the workfile in his review of the appraisal report; and that the workfile was located in the appraisal office and was readily accessible. Petitioner alleges the omission of the workfile from Respondent's review of the appraisal report violated statutorily adopted appraisal standards as well as the statutory requirement to exercise reasonable diligence in Subsections 475.624(14) and (15), Florida Statutes (2001) (the relevant statutes). The parties agree no express requirement existed for Respondent to review the workfile. SR 2-3 discusses the standard of care applicable to the supervision of assistant appraisers. In relevant part, the standard states: When a signing appraiser(s) has relied on work done by others who do not sign the certification, the signing appraiser is responsible for the decision to rely on their work. The signing appraiser(s) is required to have a reasonable basis for believing that those individuals performing the work are competent and that their work is credible. SR 2-3, USPAP at 30-31. Respondent did not rely on work done by an assistant appraiser who did not sign the appraisal report. Ms. Hall signed the appraisal report as the "Appraiser." Respondent signed the appraisal report as the "Supervisory Appraiser." On April 5, 2002, Respondent had a reasonable basis, within the meaning of SR 2-3, to believe that Ms. Hall was competent and that her work was credible. Ms. Hall had sufficient experience and demonstrated proficiency to develop and communicate the appraisal report without the need for Respondent to review her workfile. Ms. Hall began appraising real estate in 1979 and had been a certified appraiser in several states. On April 5, 2002, she was certified in Florida and New York, had worked for Respondent for approximately three years, and had completed over 100 appraisals for Respondent. Ms. Hall was a Senior Resident Appraiser in the Society of Real Estate Appraisers. Other than enforcement action ancillary to this proceeding, Ms. Hall has no disciplinary history against her professional license. Respondent had sufficient experience and demonstrated proficiency to continually evaluate the competence of Ms. Hall. Respondent was first licensed as an appraiser in Kentucky in 1965 and became a licensed appraiser in Indiana in 1967 where he also taught appraisal courses. Respondent moved to Florida in 1977 and continued his career as an appraiser and appraiser instructor. In accordance with statutory requirements enacted in 1990, Respondent became certified in Florida as a General Real Estate Appraiser and is authorized to appraise commercial, industrial, and residential real estate. Respondent has developed and reviewed thousands of real estate appraisals in Florida and has no disciplinary history against his professional license. A footnote to SR 2-3 references Advisory Opinion AO-5 on page 132 of USPAP. Advisory Opinion AO-5 does not establish new appraisal standards or interpret existing standards. Rather, the Opinion illustrates the applicability of appraisal standards in specific situations and offers advice for the resolution of appraisal issues and problems. In the terms of Advisory Opinion A-05, Respondent was a principal on April 5, 2002, and Ms. Hall was an assistant. The extent of assistance that can be provided in the appraisal process is directly related to the competence of the assistant. As experience and demonstrated proficiency increase, it is appropriate for the principal to place greater reliance on the work performed by the assistant. It is appropriate for a principal to allow an experienced assistant with demonstrated proficiency to develop and communicate an appraisal. Such an assistant is competent to inspect the property, take pictures, draft the final appraisal report, and cosign the appraisal report with the principal. Advisory Opinion AO-5, at page 134, lines 112-114, lists only two minimum standards for the supervision of an experienced assistant. The principal should inspect both the exterior of the property and the photographs. Respondent's review of the appraisal report exceeded the express minimum standards for supervision of an assistant. Respondent personally inspected the property and the photographs and examined the appraisal report to verify that the distances of the comparables from the property were appropriate. Respondent ensured that adjustments in the report between comparables and the property were accurate and not excessive and also validated the calculation of adjustments in the appraisal report. Respondent reviewed maps of the area and verified dates and legal descriptions in the appraisal report. The omission of the workfile from Respondent's review of the appraisal report did not violate the standard of practice in the community in which Respondent and Ms. Hall practice. Two certified real estate appraisers with significant experience testified as peers in the community. Their testimony confirms the practice followed by Respondent and Ms. Hall.5 The community standard does not require a principal to review the workfile of an experienced appraiser unless the appraisal report is complex. The appraisal report that Respondent reviewed was not complex. Ms. Hall appraised a manufactured home in an area zoned for condominiums with no existing condominiums. A variation between actual and zoned use does not make an appraisal complex. As one peer explained in her testimony, "That wouldn't have made it complex to me. Zoning is a simple thing to me." The community standard of peers is an acceptable measure of competence in the appraisal standards adopted by statute. SR 1-2(f), USPAP at page 17, states that the scope of work necessary to complete an assignment is acceptable when it is consistent with the actions that peers would take in performing the same assignment or a similar assignment. A requirement for a principal to review the workfile of an experienced appraiser would be problematic in the community. Many experienced appraisers work from home and do not provide their principal with the workfile until after the appraisal report is communicated to the client. Even when a workfile is readily accessible, most principals do not have time to personally review the workfile. A principal must rely on administrative staff to perform that task. Only larger appraisal companies with extra staff have the luxury of reviewing workfiles. One peer who testified at the hearing had previously operated an appraisal company with sufficient staff to review workfiles. The staff routinely reviewed only the workfiles of assistants in training. Staff did not review the workfiles of experienced assistants.6 Respondent's signature on the appraisal report appears under a "Supervisory Appraiser's Certification." In relevant part, Respondent certified that he agreed to be bound by Appraiser Certification numbers 4-7 in the appraisal report. Appraiser Certification numbers 4-6 are neither relevant nor material to the matter at issue. The certifications address racial and other types of bias, an interest in the property, and a predetermined appraised value. Appraiser Certification number 7 certifies that Ms. Hall performed the appraisal in compliance with applicable appraisal standards. Similarly, the Supervisory Appraiser's Certification states that Respondent takes "full responsibility for the appraisal and the appraisal report." Petitioner interprets the quoted terms and similar terms elsewhere in the appraisal standards to mean that Respondent certifies to Petitioner that Ms. Hall performed the appraisal correctly and that Respondent is responsible to Petitioner for her errors. Petitioner interprets the certification of the "appraisal" to include the workfile. The agency's interpretation of statutory terms conflicts with the weight of the evidence. The term "responsibility" is reasonably construed as acknowledging responsibility to the client, rather than Petitioner, for the acts or omissions of an assistant. If Respondent were to evade his responsibility to the client, Respondent arguably may be responsible to Petitioner for the evasion. However, there is no evidence that Respondent attempted to evade his responsibility to the client. The precipitating complaint for this proceeding did not originate from the client, and there is no evidence of harm to the client. Ms. Hall does not know how the correct sales price information was omitted from the appraisal report. There is no evidence of intent or culpable knowledge by Ms. Hall. The closing price of a comparable is not the type of information that an appraiser would knowingly alter in an appraisal report. The correct closing prices at issue were matters of public record at the time and were so basic and fundamental that their omission from the appraisal report is patently inadvertent in the absence of contrary evidence. Ms. Hall followed the normal appraisal procedure she has used consistently over time. She utilized what is identified in the record as a clone appraisal. Ms. Hall modified an appraisal she had previously completed with data pertinent to the property being appraised. Either the computer program did not accept the correct closing prices for the comparables or Ms. Hall inadvertently failed to "input" them. Respondent did not have constructive knowledge of facts unknown to Ms. Hall at the time she drafted the appraisal report. SR 1-1(c), USPAP at page 15, does not define competency as perfection. Perfection is impossible to attain. Rather, competency requires only that Respondent use due diligence and due care in reviewing the appraisal report.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order finding Respondent not guilty of the violations charged in the Administrative Complaint and imposing no penalty against Respondent's professional license. DONE AND ENTERED this 3rd day of February, 2006, in Tallahassee, Leon County, Florida. S DANIEL MANRY 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 3rd day of February, 2006.
The Issue Should the Florida Real Estate Appraisal Board (the Board) take action against Respondent, a licensed real estate appraiser (appraiser), for violations set forth in Chapter 475, Part II, Florida Statutes (1995)?
Findings Of Fact Stipulated Facts: Respondent is a state-licensed appraiser. On or about January 9, 1997, Respondent, Fred Catchpole, and Rhonda Guy developed and communicated an appraisal report for property commonly known as 693 Broad Street, Pensacola, Florida 32819. In developing the subject property appraisal report, the Cost Approach and the Sales Comparison Approach were utilized. Additional Facts: Eventually the circumstances concerning the Uniform Residential Appraisal Report (the Report) at the 693 Broad Street, Pensacola, Florida, property (the Property) came to Petitioner's attention upon a complaint. On February 13, 2001, the complaint was made. The complaint was made by Daniel Alvin Ryland, a Florida-licensed appraiser who has provided appraisal services in Escambia and Santa Rosa counties in Florida. The investigation of the complaint covered the period February 20, 2001, through December 26, 2001. Benjamin F. Clanton was the principal investigator. At present, he is an investigator supervisor for Petitioner. He has held that position since 2002. Mr. Clanton started investigating appraisal cases in 1995, when he retired from the Birmingham Police Department in Birmingham, Alabama. In that year, he was employed by the Alabama Real Estate Appraisal Board. While there, he took three courses: the Appraisal of Real Estate, a 45-hour course; the Basic How to Appraise, a 25-hour course; and Uniform Standards of Professional Appraisal Practices (USPAP), a 16-hour course. He took an update in USPAP in 1997, a four-hour course. Mr. Clanton continued with Appraisal Institute courses or courses involving appraisal principles and procedures, basic income capitalization, residential case studies and a national USPAP course and other updates. As part of the investigation, Mr. Clanton interviewed Respondent Harrison. Mr. Clanton sought documentation from the Respondent in the interest of the recreation of the Cost Approach in the Report. Mr. Clanton asked for the work files supporting the Report. Respondent provided work files. Discrete information concerning recreation of the Cost Approach was not received by Mr. Clanton. From his observations related to the Cost Approach within the Report, Mr. Clanton describes problems with the calculations of the Cost Approach where the stated effective age in the comments on the Cost Approach was 25 years. That calculated to be significantly different, in his understanding, than the number used in the depreciation in the Cost Approach. The Report reflected a remaining economic life of 35 years and a total life expectancy of 60 years. He refers to the Report's statement of the effective age of the Property as 15 years. In his testimony, Mr. Clanton describes the age life depreciation method leading to establishment of the effective age but he was never qualified as an expert to allow consideration of the testimony on the age life depreciation method or other issues related to the Cost Approach. Therefore, no further facts are found on that topic. When interviewed by Mr. Clanton, Respondent Catchpole in DOAH Case No. 06-3389PL acknowledged that there were errors in the Cost Approach formulations attributed to Respondent Harrison. The nature of any errors was not explained. Without that explanation they become inconsequential. More particularly, the Property neighborhood is slightly north of Interstate 10 in Pensacola, Florida, west of Pine Forrest Road, to the west side of Highway 29, and south of Alternate 90. The Property is located in what is referred to as the Ensley area. The Property is one of the largest residences in the Ensley area, in particular in Ensley Gardens. Immediately off of Highway 29 are rows of commercial buildings. Behind those rows is a railroad track. The Property is about 200 feet from the railroad track. An Escambia County utilities substation, pumping station, is located north of the Property. The Escambia County public utilities facility is about 200 feet from the Property. The Property is located north of Broad Street. The Property is on a large lot. Homes across from the Property on Broad Street are located on smaller lots. The property is not in a Planned Unit Development (PUD). The area of the subject property is not homogenous, in that the homes vary widely in quality, design, age and size. By choice of the appraiser, the Sales Comparison Approach was used in determining the appraisal for the Property. There were three comparable sales. At the time the Report was written the Property was 27 years old. Comparable sale one was two years old. Comparable sale two was 12 years old. Comparable sale three was 9 years old. The Property site was 120 feet by 260 feet according to the Report. This was larger than the comparable sales sites. Respondent, in providing information from the work file related to the Report, included information from a Multiple Listing Service (MLS) for January 1997 from the Pensacola Association of Realtors. In reference to comparable sale one, the MLS refers to the location as Creekside Oaks Subdivision, a luxury home under construction and a Parade Home entry. It refers to a sprinkler system, pantry, cathedral ceilings, security alarm, two+ closets in the master bedroom, separate shower in the master bedroom, an open patio, laundry/utility room, on a golf course, with a two-car garage. It has a whirlpool for the master bedroom bath. It has double pane glass. In relation to comparable sale two, the MLS refers to soaring cathedral ceilings with a fireplace in living room and screen porch, a hot tub and gorgeous yard with pool. The pool is described as an in-ground pool. There is a reference to a unique atrium, an inside laundry, walk-in closets, sprinkler systems, laundry/utility room and security alarm. The MLS pertaining to comparable sale three refers to the Kings Road Subdivision in Cantonment, whereas the Report refers to the location as Pensacola. In relation to comparable sale three on Kings Road in Cantonment, that neighborhood has deed restrictions limiting the type of homes and the size of homes. It has a public sewer. It has underground utilities. It has a concrete curb and gutter. The house is described as having a fireplace, sprinkler system, screen porch, high ceilings, security alarm, two-car garage, with a garden tub in the master bath. It refers to a laundry inside. There is a pool. The Report in the section under the Comparable Sales Approach, under the sales comparison analysis that refers to design and appeal described the Property and the comparables as ranch/average. The Property and the comparable sales properties were all described as suburban-average as to location. The sites were described as average for the Property and inferior for the comparables with a $3000 positive adjustment in each comparable sale to compensate for the difference. The Property did not have a pool. Two of the comparable sales had pools. Mr. Clanton asked the Respondent to provide him with a second appraisal report on the Property. Respondent agreed to provide it and mailed it to Mr. Clanton. A second appraisal report was not received by Mr. Clanton. Nothing more is known about a second appraisal report. In the appraiser certification signed by Respondent as appraiser and signed by Respondent Catchpole, DOAH Case No. 06- 3389PL, as supervisory appraiser, under item 8 it was stated: "I have personally inspected the interior and exterior areas of the subject property . . . ." Within item 8 to the appraisers certification, it went on to say that there was a personal inspection of " . . . the exterior of all properties listed as comparables in the appraisal report " Respondent in this case did not inspect the interior of the Property as part of the appraisal, by contrast to an awareness of the exterior. Respondent Catchpole, DOAH Case No. 06-3389PL, served as the supervisory appraiser and as such did not inspect the Property in any respect. Respondent Fred R. Catchpole, DOAH Case No. 06-3389PL, reviewed comparable property data in relation to the sales comparison analysis but was not involved in the selection process in choosing comparable sales. The form used in preparing the Report is referred to variously as Freddie Mac Form 70 6/93 and Fannie Mae Form 1004 6/93. In the Report in the section involving subject matter, Fred and Juanita Hicks were listed as borrowers and the current owner of the Property. The property rights being appraised were under the heading "fee simple." There was a reference to a lender/client as Home Star Mortgage Lending. The results of the Report did not lead to any direct harm to a consumer, in particular, the listed borrowers, Fred and Juanita Hicks.
Recommendation Upon consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a final order be entered dismissing the Administrative Complaint against Respondent. DONE AND ENTERED this 30th day of May, 2007, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 30th day of May, 2007.
The Issue The issue is whether Respondent committed the violations alleged in the Administrative Complaint, and if so, what discipline should be imposed.
Findings Of Fact Respondent is a certified residential real estate appraiser. His license number is RD-4163. Respondent was licensed as a registered trainee appraiser in December 2001. He passed the certification exam and received his current license in November 2003. Respondent has not previously had any disciplinary action taken against him by the Division or the Florida Real Estate Appraisal Board (Board). On June 14, 2005, Respondent was engaged by a mortgage company to appraise the single-family residence located at 620 Adirondack Avenue in Orlando (“the subject property”). The subject property was owned at the time by Cosme Abreu and his wife. The Abreus also owned a single-family residence located at 623 Adirondack Avenue, which is across the street from the subject property. The subject property was at the time of the appraisal under contract for sale to Jose Ciro, who was a co-worker of Mr. Abreu's. Respondent previously conducted an appraisal of the subject property in March 2005. His firm also conducted several appraisals of the Abreus' property at 623 Adirondack Avenue, including an appraisal on June 14, 2005. Respondent went to the subject property on June 14, 2005, and walked around the inside and outside of the residence taking measurements and observing the condition of the property. He testified that at the time of the appraisal the subject property was in good overall condition; that all of the appliances were in place; that the air conditioner was working; that the carpet and flooring were in place; and that there was no readily observable water damage or rotten wood on the interior or exterior of the residence. Respondent prepared an appraisal report of the subject property on June 14, 2005. Respondent estimated in his report that the market value of the subject property as of the date of the appraisal was $185,000. Respondent used the cost approach and the sales comparison approach to arrive at that valuation. The Division’s expert appraiser, Ben Cole, III, did not take issue with the methodology used by Respondent in his appraisal of the subject property. Indeed, Mr. Cole stated in his report that: “The [comparative] sales were legitimate transactions, pertinent and in close proximity to the subject. The home was measured correctly and the square footage correctly computed with the room count and placement shown properly.” Nevertheless, Mr. Cole testified that the appraisal report prepared by Respondent was misleading because it did not disclose the actual condition of the subject property as of the date of the appraisal. Mr. Cole did not have any personal knowledge as to the condition of the property as of the date of the appraisal; his opinion regarding the misleading nature of Respondent’s appraisal report was based upon the assumption that the condition of the subject property at the time of the appraisal was as reflected in the photographs taken in August 2005. However, as discussed below, the validity of that assumption was not established by clear and convincing evidence. Respondent did not take photographs of the subject property in connection with the June appraisal. The exterior photographs of the subject property included in his appraisal report were the photographs that he took in connection with the March appraisal. Respondent testified that the March photographs accurately depicted the condition of the subject property as he observed it in June, and he stated in his appraisal report that the subject property has been “maintained in good overall condition.” Mr. Abreu testified that subject property was in good condition at the time of the appraisal, which was consistent with and corroborated Respondent’s assessment of the condition of the subject property.3 Mr. Ciro had no direct personal knowledge about the condition of the subject property in June 2005. He did not take possession of the property until mid-August 2005, even though the closing occurred in mid-July 2005. Mr. Ciro had only visited the subject property twice before August 2005. One of those visits occurred prior to the three hurricanes that hit the Orlando area in August and September of 2004. Mr. Ciro could not recall the date of his other visit to the property, but it was before June 2005. Mr. Ciro testified that the subject property was in good condition at the time of his visits, although he acknowledged that he did not closely examine the outside of the house because it was nighttime when he was at the subject property. The condition of the subject property in August 2005 was not good, as reflected in the photographs and videotape that were received into evidence. For example, the carpet in the family room was missing, appliances were missing, the kitchen sink and cabinets had been removed and were on the back patio, there was a stain of some kind on the ceiling in at least one of the rooms, the backyard was overgrown and full of trash, and there was damage to the soffit on the right-front of the house. Mr. Abreu testified that some of the damage depicted in the photographs and videotape -- e.g., removal of the sink from the kitchen, floor damage caused by a plumbing problem -- occurred between the time of the appraisal and the time that Mr. Ciro took possession of the subject property, and that he was in the process of fixing the damage when Mr. Ciro took possession of the property. Mr. Abreu attributed the remainder of the damage to Mr. Ciro. Mr. Ciro and the Abreus are currently in litigation regarding the sale of the subject property and its condition in August 2005. Respondent is not a party to that litigation. Respondent and Mr. Abreu testified that the August 2005 photographs do not reflect the condition of the property as of the time of the appraisal on June 14, 2005. That testimony is called into question by the photograph in the appraisal report that appears to show that the soffit damage observed in August 2005 on the right-front corner of the house was present at the time of the March appraisal,4 but the evidence was not clear and convincing on that issue. In October 2005, the Division received a complaint from Mr. Ciro regarding Respondent’s appraisal of the subject property. Beverly Ridenauer was assigned to investigate the complaint. It took Ms. Ridenauer several months to make contact with Respondent because the address that the Division had on file for him was incorrect. Respondent was not able to produce his work file for the subject property when it was initially requested by Ms. Ridenauer.5 When the original work file could not be located, Respondent “reconstructed” the file and provided it to Ms. Ridenauer. The original work file was subsequently located and provided to the Division during discovery. There is no evidence of any discrepancies between the “reconstructed” file and the original file. The work file was not offered into evidence, but Respondent testified that it included the property appraiser records, Multiple Listing Service print-outs, and other information he reviewed and considered in his appraisal of the subject property. Respondent required his trainees to take interior photographs of the property they appraised for his use in reviewing and signing-off on their work, but he did not take interior photographs of properties that he appraised unless the lender specifically requested such photographs. As a result of this case, however, Respondent now takes interior photographs as a standard practice in order to “protect [him]self.” There is no statute, rule, or USPAP standard that requires interior photographs to be taken as part of an appraisal. The Division’s expert appraiser, Mr. Cole, did not know whether it was even typical for appraisers to take interior photographs; he simply testified that such photographs “would have been helpful” in this case.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Board issue a final order dismissing the Administrative Complaint. DONE AND ENTERED this 22nd day of August, 2007, in Tallahassee, Leon County, Florida. S T. KENT WETHERELL, II 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 22nd day of August, 2007.
The Issue Whether the Respondent, Omari Murray, committed the violations alleged in the Administrative Complaint and, if so, what penalty should be imposed.
Findings Of Fact At all times material to the allegations of this case, the Petitioner was the state agency charged with the responsibility to administer and enforce the real estate licensing laws found in Chapter 475, Florida Statutes (2004). At all times material to the allegations of this case, the Respondent was a registered trainee appraiser who was subject to the provisions of Chapter 475, Florida Statutes (2004). As an appraiser trainee, the Respondent was required to perform appraisal services through a fully registered real estate appraiser licensed pursuant to Florida law. On or about December 21, 2002, Ms. Cesar paid the Respondent $550.00 to perform an appraisal for her vacant lot located at 4229 Southwest Jarmer Road, Port St. Lucie, Florida. Ms. Cesar paid the Respondent by check drawn on her personal bank account. The check was payable to the Respondent individually. The check was negotiated and the account was debited in the full amount of the check. At the time she tendered the check to the Respondent Ms. Cesar was under the impression that the Respondent was an appraiser who could lawfully perform the appraisal sought. The Respondent did not advise Ms. Cesar that he was only a trainee appraiser and that his supervisor would have to sign any appraisal report generated in connection with the Cesar property. Additionally, at that time, the Respondent’s supervising appraiser, Harvel Gray, was not aware of the appraisal assignment from Ms. Cesar, did not authorize the Respondent to accept the job, and did not authorize the Respondent to accept payment for the appraisal in his individual name. The funds for the Cesar appraisal were not forwarded to Mr. Gray. When Ms. Cesar asked the Respondent for the appraisal she had paid for, the Respondent told her it was illegal for him to give her a copy of the appraisal. She did not understand why she had paid $550.00 and was not provided with a copy of the appraisal. Ms. Cesar had planned to build a house on the vacant lot. She believed the Respondent could facilitate that project as he represented to her that he could get plans drawn, perform the appraisal, and help her through the entire process. In total Ms. Cesar paid the Respondent over $2000.00 to further the construction of the house. On or about July 7, 2003, an authorized representative of the Department, Jonathan Platt, contacted the Respondent and requested that the Respondent provide a copy of the appraisal performed for Ms. Cesar. On or about August 11, 2003, the Respondent produced a “comparative market analysis” report (the report) dated December 27, 2002, for the subject property (Ms. Cesar’s vacant lot). The report was on a Uniform Residential Appraisal Report form and identified the Respondent as the appraiser. Additionally, the form noted the Respondent’s license number as 0005168. The report did not indicate that the report had been reviewed or approved by a licensed appraiser. The report claimed the analysis was both “as is” and subject to the completion of work as specified in plans and specifications. There were no plans or specifications attached or included with the report. The report was not signed by a licensed real estate appraiser. After review of the report, Mr. Platt asked the Respondent for the work file that supported the appraisal report. Requests for the work file were made on August 12, 2003, September 30, 2003, and October 1, 2003. As of the time of hearing the Respondent had not made such file available to the Department. Harvel Gray is a licensed real estate appraiser. Mr. Gray appraises real estate and equipment and knows the Respondent. Mr. Gray met the Respondent when he applied to become a trainee appraiser about five years ago. For approximately three or four months Mr. Gray was technically the Respondent’s supervisor but performed no appraisals with the Respondent. In fact, Mr. Gray terminated his relationship with the Respondent before any appraisals could be performed. Mr. Gray did not know anything about the appraisal that was to be performed for Ms. Cesar. Ken Drummond is also a licensed real estate appraiser. Mr. Drummond knows the Respondent from a Gold Coast continuing education class. Mr. Drummond has never been the Respondent’s supervising appraiser. Mr. Drummond has not performed appraisals with the Respondent. According to licensing records, the only supervising appraiser with whom the Respondent was listed during the pertinent period of time as an appraiser trainee was Mr. Gray. Neither Gray nor Drummond authorized the Respondent to perform an appraisal or complete the report for Ms. Cesar. Neither Gray nor Drummond authorized the Respondent to accept payment from Ms. Cesar for any work. Jonathan Platt, the investigator assigned to this case, spoke with the Respondent and exchanged written information with him. The Respondent did not provide information requested by Mr. Platt and did not explain how the report was generated. According to Mr. Platt the Respondent maintained that Mr. Drummond was his supervising appraiser during the time the Cesar report was performed.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Real Estate, enter a Final Order that finds the Respondent guilty of the violations outlined by the Administrative Complaint and revokes his license as a real estate appraiser trainee. S DONE AND ENTERED this 30th day of August, 2005, in Tallahassee, Leon County, Florida. ___________________________________ J. D. 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 30th day of August 2005. COPIES FURNISHED: Elizabeth Vieira, Director Division of Real Estate 400 West Robinson Street Suite 802 North Orlando, Florida 32801 Leon Biegalski, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202 Alpheus C. Parsons, Esquire Department of Business and Professional Regulation Hurston Building, North Tower, Suite N801 400 West Robinson Street Orlando, Florida 32801 Omari Murray 201 Southwest 11th Avenue Boynton Beach, Florida 33435