The Issue The issues framed by the Stipulated Issues, Facts and Exhibits are whether the license of David L. Norris as a certified general contractor should be disciplined for violation of: Section 489.129(1)(e), Florida Statutes (1983), by aiding an unlicensed person to evade the requirements of Chapter 489; Section 489.129(1)(f), Florida Statutes (1983), by knowingly conspiring with an unlicensed person to use Norris' certificate with the intent to evade the requirements of Chapter 489; Section 489.129(1)(j), Florida Statutes (1983), through the violation of Section 489.119, Florida Statutes (1983), by failing to qualify a firm through which Respondent was acting; Section 489.129(1)(g), Florida Statutes (1983), by acting in a name not on his license. At the final hearing, the Department amended the Administrative Complaint to dismiss the violations of Sections 489.129(1)(k) (abandoning a contracting job) and (m) (gross negligence or malpractice in contracting). The Department presented the two witnesses and the Respondent presented one witness. Twelve exhibits for the Department were received into evidence, and Mr. Norris offered one exhibit. The parties also stipulated to certain facts. (See Stipulated Issues, Facts and Exhibits filed May 15, 1986, Tr. 4-5)... /1
Findings Of Fact At all times material, Respondent, David L. Norris, was a certified general contractor, having been issued license numbers CG C011081 and CG CA11081, by the State of Florida, Department of Professional Regulation, Construction Industry Licensing Board. (PX 2; Stp. F. #1, Administrative Complaint paragraph 2) At all times material, Mitch Kobylinski (Kobylinski) was unlicensed, and KMK Remodeling and Repair (KMK) had no qualifying agent for the purpose of engaging in contracting under Section 489.119, Florida Statutes (1983). At times Kobylinski has done business as KMK. (PX 1; Stp. F. #2; Tr. 18-21) At no time did the name Kobylinski or KMK appear on the license issued to Norris by the Construction Industry Licensing Board, nor did Norris qualify a business by that name. (Stp. F. #1, Administrative Complaint paragraph 9) Norris knew Kobylinski was not licensed to engage in contracting. (Stp. F. #1, Administrative Complaint paragraph 5) Kobylinski had worked for Norris on prior jobs, including working for Norris in the capacity as overseer on a large room addition. Norris had paid Kobylinski by the hour, by the day or by the type of work Kobylinski did. On one other job, Norris and Kobylinski shared the job in that Kobylinski was paid by the day, however, at the end both Respondent and Kobylinski split the profit. (Tr. 21,22) Kobylinski, not Norris, was initially contacted by a leasing agent to improve a structure for Marianne Tomlinson (Tomlinson) at 21073 Jog Road, Suite 21, Boca Raton, to become Tootsie's, a nail salon. Kobylinski indicated to the leasing agent and Ms. Tomlinson that he would have to perform the work with a general contractor. (Stp. F. #3; Tr. 24) Kobylinski presented a proposal on KMK's letterhead, dated August 17, 1984, to Tomlinson for the work to be done. (PX 3; Tr. 16, 18) Norris also submitted a proposal, dated August 15, 1984, to Tomlinson. The evidence does not show what letterhead was used by Norris, because the exhibit is a carbon copy. (RX 1) The proposed cost of the work from Kobylinski was $23,593.75 and from Norris was $23,600. Both proposals made separate provisions for formica work at additional prices of $10,600 and $10,500 respectively. (Stp. F. #4; PX 3; RX 1) Only Kobylinski's proposal was signed by Ms. Tomlinson. (PX 3; Tr. 39) Norris and Kobylinski agreed that Norris would act as the overseer of the job and that, as compensation, Norris initially was to receive $1,000.00 to begin the job (Tr. 26) and further monies depending upon time Norris expended on the job (Tr. 22-23, 28-29). They also agreed that Kobylinski was to deal exclusively with Tomlinson and be responsible for all monies on the job and paying subcontractors. (Tr. 26, 43) No agreement was signed between Norris and Tomlinson providing that Norris would be the contractor for the job. (Tr. 38-39) Norris applied for and was issued, on September 18, 1984, the building permit for the Tomlinson job. (PX 4,5; Stp. F. #1, Administrative Complaint paragraph 6; Tr. 39) Norris contacted the electrician, at the initial stage of the job, for the electrical work. (Tr. 56) A certificate of occupancy was issued for the job. (Stp. F. #6; Tr. 46) Tomlinson made all payments for the construction work by checks payable to Kobylinski, drawn on Tomlinson's business account for Tootsie's. (PX 7; Tr. 30) Near the end of the job, Tomlinson gave Kobylinski a check, dated December, 1984, for $4,000.00. There were not sufficient funds in the account for Kobylinski to cash the check. Kobylinski returned to Tomlinson with the check, and Tomlinson issued him a replacement check for $2,000.00. She requested the return of the $4,000.00 check to her, but Kobylinski had not brought that check with him. At this point in time, the working relationship between Kobylinski and Tomlinson broke down. (PX 7; Tr. 31,32) Tomlinson submitted her punch list, dated December 17, 1984, to Norris. On it she identified him as the contractor for her job and stated she wanted to make the final payment to him. (PX 6) On January 20, 1985, due to problems with the punch list and remaining payment, Tomlinson and Norris met. As a result of that meeting, they reached an agreement dated January 20, 1985, as to what remained to be paid, viz., $4,113.75, and what work remained to be done. The August 17th agreement between Kobylinski and Tomlinson was referenced in the agreement of January 20, 1985. (PX 8; Tr. 45) By January 20, 1985, Kobylinski would have received all the monies for the cost of the work, according to the August 17th agreement, if the $4,113.75 were paid by Tomlinson. (Stp. F. #5) On January 21, 1985, Norris filed a claim of lien against the Tomlinson job. The lien indicated that the total value of the work was $23,593.75 (which was the cost of construction according to the contract with Kobylinski) and that the amount unpaid was $4,113.75. Norris filed the lien because, after signing the agreement of January 20, 1985, he and Tomlinson had further disagreements. (PX 9; Tr, 46) In a letter to Norris, dated April 23, 1985, in an attempt to get Respondent to release his lien, Tomlinson indicated that she had contracted with Kobylinski, not Norris, to do the work for her. (PX 11) As compared to the compensation received by Norris, Kobylinski has received over one-half the money from the Tomlinson job. (Tr. 28)
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that Respondent be found guilty as charged in the Administrative Complaint, as amended at the final hearing, and that an administrative fine of $1,000.00 be imposed. DONE AND ORDERED this 9th day of October 1986 in Tallahassee, Leon County, Florida. WILLIAM R. DORSEY, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of October, 1986.
The Issue Whether Petitioner, William P. Pearson, Jr., is entitled to recover attorney's fees and costs pursuant to the Florida Equal Access to Justice Act, Section 57.111 Florida Statutes and Rule 221-6,35. BACKGROUND AND PROCEDURE At hearing, Petitioner presented the oral testimony of William P. Pearson, Jr. and had admitted five exhibits. Respondent presented the oral testimony of Richard Hartog, Investigator, and Douglas A. Shropshire, the Department of Professional Regulation's senior attorney for the prosecution of all Florida Construction Industry Licensing Board cases, and had admitted five exhibits. At close of formal hearing, Petitioner elected to make oral closing argument and to file no post-hearing proposals. Respondent elected to file a transcript of proceedings and written proposed findings of fact and conclusions of law within 10 days of filing transcript. Respondent's proposals are ruled on within the appendix to this recommended order pursuant to Section 120.59(2) Florida Statutes.
Findings Of Fact Petitioner seeks to recover attorney's fees and costs associated with his defense against charges contained in an administrative complaint filed and prosecuted by the Department of Professional Regulation which was styled, Department of Professional Regulation, Construction Industrv Licensing Board v. William P. Pearson, Jr., DOAH Case No. 85-0672. The administrative complaint in DOAH Case No. 85-0672 contained two counts. Count I alleged a violation of Section 489.129(1)(c) through violation of Section 455.227(1)(a) Florida Statutes (1983), which statutory section addresses making misleading, deceptive, or fraudulent representations in the practice of the profession of construction. Count II alleged a violation of Section 489.129(1)(d) Florida Statutes (1983) by not complying with the specific escrow requirements imposed by the consumer protection Statute, Section 501.1375(2) Florida Statutes and violation of Section 489.129(1)(m) Florida Statutes (1983), which latter statutory section addresses gross negligence, incompetence or misconduct in the practice of contracting. The state agency was therefore not a nominal party only but was an accusing and principal party. Petitioner seeks an award of attorney's fees in the sum of $3,568.75 together with costs of $11.10. Respondent, in its Amended Response to Petitioner's Amended Motion for Attorney's Fees and Costs, did not challenge the reasonableness of the attorney's fees and costs set forth in Petitioner's affidavit attached and incorporated in his Amended Motion and specifically stipulated to reasonableness and necessity at formal hearing. Accordingly, the foregoing amounts are found to be necessary and reasonable. Pearson Construction Co., Inc.'s domicile during the whole of DOAH Case No. 85-0672's initial prosecution was Charlotte County, Florida. It had no employees other than William P. Pearson, Jr. and his wife, who worked without compensation. William P. Pearson, Jr. was the president and qualifying agent of Pearson Construction Co., Inc. which was a Florida corporation at all times material to the initial prosecution. The combined net worth of William P. Pearson, Jr. and of Pearson Construction Co., Inc. never exceeded two million dollars and presently petitioner Pearson's personal net worth does not exceed two million dollars. In early 1986, prior to initiating this instant fee and costs recovery case, Mr. Pearson failed to update payment of his corporate fees and Pearson Construction Co., Inc. was automatically dissolved by the secretary of State. Respondent Department of Professional Regulation (DPR) notified John Vlasek of its intent to investigate his complaint against Petitioner in late July 1984. DPR's investigation was conducted by Investigator Richard Hartog. Mr. Hartog has been employed by the Respondent since November 1982 and has been its investigator since March 1983. He has a degree in criminal justice and 23 years prior experience as a detective with the Police Department of Nassau County, New York. Investigator Hartog was first made aware of vlasek's complaint against Pearson Construction Co., Inc. by way of a memorandum dated July 16, 1984 received directly from the State Attorney's Office for the 20th Judicial Circuit. Attached to the State Attorney's memorandum was a 6 page consumer complaint form signed by John A. Vlasek. Hartog determined that William P. Pearson, Jr. was the qualifying agent for Pearson Construction Co., Inc. and then telephoned DPR's complaint section in Tallahassee, giving the complaint section the basis of the information received from the State Attorney's Office and statutory citations for alleged violations of sections 489.129(1)(m), 455.227(1)(a) and 501.1375 Florida statutes. His purpose was to obtain a complaint number to continue the investigation. Investigator Hartog personally interviewed Petitioner William P. Pearson, Jr. regarding the allegations underlying Vlasek's complaint. Upon completion of the investigation the Department's investigator prepared an investigative report. The investigative report includes a narrative summary of the investigator's interview with Pearson. The investigative report prepared at the conclusion of Hartog's investigation contains the following findings with regard to the investigator's interview of Pearson: Mr. Pearson states he built a good number of homes a year. Last year he built thirty-nine (39) homes. Mr. Pearson was readvised of the allegations made by Mr. Vlasek, a prospective buyer of one of Pearson's spec homes. Mr. Pearson maintains the reason the house was not completed on June 12, 1984, the date originally stipulated in the contract, was the fact Mr. Vlasek was not in a hurry to have the house completed. Mr. Pearson stated he is not aware of the requirements of P.S. 501.1375, therefore, he did not handle the deposit according to the requirement set forth. The money was used to complete the spec house for Vlasek. Mr. Pearson states he received a letter from the First Federal Savings and, Loan of Charlotte County indicating Mr. Vlasek obtained an extension of his loan commitment with the bank. Mr. Malone, who was present, verifies that such a letter was received by Mr. Pearson. Investigator Hartog personally interviewed Barbara Lowe, a loan officer for the First Federal Savings and Loan of Charlotte County. The investigator interviewed Ms. Lowe to determine "whether the bank had, in fact, sent a letter to Mr. Pearson indicating that an extension to Mr. Vlasek's 45-day loan had been extended." The investigative report prepared at the conclusion of Hartog's investigation contains the following findings with regard to the interview of Ms. Lowe: Barbara Lowe, who states she handled the transaction, states no such letter was mailed to Pearson Construction. It would not be appropriate to grant an extension in this type of action. Mr. Vlasek would be required to enter into a separate agreement for an additional forty-five (45) days thereby nullifying the original commitent. This was not done by Mr. Vlasek, therefore, the original commitment expired 5/31/84. Investigator Hartog personally interviewed Tom Hannon, a loan officer with the First Federal Savings and Loan Association in Charlotte County. The investigative report prepared at the conclusion of Hartog's investigation contains the following finding: Mr. Hannon contacted this office to relate that the loan commitment obtained by Vlasek was for a period of forty-five (45) days between 4/19/84 and 5/31/84. There is no record a thirty (30) day extension was asked for or granted according to the records. Investigator Hartog personally interviewed Jack R. Malone who was a salesman for Pearson Construction Co., Inc. The investigative report prepared at the conclusion of Hartog's investigation relates that Malone stated the deposit money was not required to be deposited in an escrow account but when referred to section 501.1375 Malone stated money might have been given to an attorney, presumably for escrow, and further Malone related that: Mr. Vlasek became very impatient because he said very little was being done to complete his house. He was concerned because the terms of his loan agreement was a commitment which expired June 1, 1984. The completed investigative report as forwarded by the investigator to the Department's legal section consisted, in part, of the following: a three page narrative summary of the investigator' s findings; a copy of the memorandum and accompanying executed consumer complaint form; a First Federal savings and Loan Association loan transfer commitment to John and Madelyn Vlasek; a copy of section 501.1375, Florida statutes; a copy of the April 1984 contract between Pearson Construction Company and John and Madelyn Vlasek reflecting a completion date altered from June 12 to June 1, 1984. Douglas A. Shropshire was the DPR attorney responsible for reviewing the investigative report with regard to making a recommendation to the probable Cause Panel of the Construction Industry Licensing Board. The complaint against Petitioner was a "case of first impression" in that DPR had not previously investigated a complaint alleging a violation of the escrow requirement of Chapter 501, Florida Statutes. As a result of the complaint against Petitioner, Mr. Shropshire requested that a law clerk prepare a memorandum of law with regard to the relationship between Section 501.1375, Florida Statutes and the regulation of licensed contractors under Chapter 489 Florida Statutes. On or about September 21, 1984 the law clerk provided Mr. Shropshire with a two page memorandum of law exploring the relationship between Chapter 501, Florida Statutes and the regulation of the construction industry. The memorandum reached the general conclusion that licensed contractors were subject to the provisions of Chapter 501 Florida Statutes. In preparing his recommendation to the Probable Cause Panel, Shropshire reviewed both Hartog's investigative report with all attachments and the law clerk's memorandum of law. On January 10, 1985 DPR, through Mr. Shropshire, made a probable cause recommendation to the Construction Industry Licensing Board Probable Cause Panel. Prior to January 10, 1985 DPR had provided each panel member with a copy of the DPR's probable cause package. The probable-cause package as reviewed by the Probable Cause Panel consisted of the following: a cover sheet setting forth the Subject's name, case number and statutory violations; a proposed administrative complaint; a copy of the narrative portion of the Department's investigative report. The Probable Cause Panel did not review a copy of the Vlasek-Pearson contract which provided it was not contingent on financing, which provided for forfeit to Pearson of Vlasek's deposit upon Vlasek's default, and which provided for escrow of Vlasek's deposit pending closing of the transaction. However, this item was reviewed by the DPR attorney before making the probable cause recommendation and the copy of this item reviewed showed that the completion date had been altered, allegedly by Malone. Petitioner stipulated to the correctness of the procedure employed in impaneling the Probable Cause panel. Each panel member had the opportunity to review the probable cause package before the Probable Cause Panel was convened. Each panel member had the opportunity to familiarize himself with the probable cause materials prior to the meeting. The Chairman of the Probable Cause Panel was Mr. Roy Adams. Mr. Adams is a certified general contractor. The other probable cause member was Mr. Joseph Richards. Mr. Richards is a pharmacist and is a public member of the Construction Industry Licensing Board. Neither Mr. Richards nor Mr. Adams is an attorney. The Construction Industry Licensing Board is not involved in the investigation or prosecution of a complaint. In making the determination of probable cause the panel members discussed the allegations contained in the complaint with both DPR's prosecuting attorney and their independent advisor from the Department of Legal Affairs. On January 10, 1985 the Probable Cause Panel found probable cause to believe Petitioner violated Chapter 489, Florida Statutes. The panel's finding of probable cause included, but was not limited to, the violations alleged by DPR in its recommendation. The Probable Cause Panel directed DPR to file a formal complaint. On January 16, 1985 DPR's Secretary signed a formal administrative complaint charging Petitioner with violating the provisions of Chapters 455 and 489, Florida Statutes reviewed by the panel plus Section 489.129(1)(d) Florida Statutes. Petitioner denied all the allegations in the administrative complaint and requested a formal hearing pursuant to Section 120.57(1), Florida Statutes. On August 20, 1985 a formal hearing was conducted before the undersigned hearing officer. Petitioner interposed the defense that Section 501.1375 Florida Statutes did not apply to him because he had constructed less than 10 houses in the year 1984 despite constructing more than 20 homes per year in most years. Section 501.1375 provides in pertinent part as follows: "Building Contractor" means any person who, for compensation, constructs and sells one-family or two-family residential dwelling units, except for a person who sells or constructs less than 10 units per year state wide. "Developer" means either a building contractor who offers new residential dwelling units for sale or any person who offers a new one-family or two-family dwelling unit for sale except a person who sells or constructs less than 10 units per year state wide. The Recommended Order entered December 20, 1985 found as fact that: On April 12, 1984 John and Madelyn Vlasek contracted with Pearson Construction Company for the purchase of a home in Port Charlotte, Florida. . . .The contract specified a $2,000 escrow deposit on the purchase price of $68,500. On April 12, 1984, the Vlaseks provided Pearson Construction Company with $200 in cash toward the escrow deposit. On April 13, 1984, the Vlaseks provided Pearso Construction Company with a check in the amount of $1,800 toward the escrow deposit. The contract specified the deposit was to be held in escrow pending closing of the transaction. . . .The contract referred to above was not contingent on the buyer obtaining financing. However, the deposit was not placed in escrow as specified in the contract and as required under the terms of the contract. Instead, it was used by the Respondent in purchasing lighting fixtures, carpeting, tiling and other accoutrements in colors and styles selected by John R. Vlasek. On April 23, 1984, the Vlaseks executed the loan transfer commitment. . . .After executing the loan transfer commitment, Vlasek realized that the commitment would expire prior to the June 12, 1984 closing date. Vlasek then notified Pearson Construction Company of the discrepancy between the expiration date of the loan commitment and the actual closing date. Upon being informed of the discrepancy, Jack R. Malone agreed to modify the closing date. Malone expressly modified the contract by changing the closing date from June 12 to June 1, 1984. Vlasek subsequently informed the Respondent of the change of the closing date. When informed of the change, Respondent indicated the home would be substantially completed by June 1, 1984. . . .Vlasek was repeatedly assured by Malone and other members of the construction team (not Pearson) that the home would be completed by June 2, 1984. . . .the Vlasek contract was rescinded . . .Pearson Construction Company, Inc. and William P. Pearson constructed a total of 8, possibly 9 houses during the calendar year of 1984. In most previous years he has constructed in excess of 20 houses per year. The findings and conclusions of law of the recommended order are replete with analyses of credibility of witnesses. The conclusions of law discuss such diverse legal concepts as the differences in actual versus apparent authority and ratification of an agent's/employee's misrepresentations by his employer, reasonable reliance thereon, and whether section 501.1375 should be applied annually (10 houses constructed per year) or upon a pattern of annual house construction (8-9 houses in 1984 versus more than 20 houses each previous year). The recommended order determined that DPR had failed to establish Count I (misleading, deceptive or fraudulent representations) by clear and convincing evidence and found only a "minimal" violation of Section 429.129(1)(m) had been established within Count II due to the petitioner's failure to escrow. By Final Order dated March 17, 1986, the Board adopted the findings of fact in toto. The final order rejected the conclusions of law and dismissed the administrative complaint. No evidence was introduced to indicate or otherwise explain why the Board rejected the hearing officer's conclusions of law.
Findings Of Fact At all times relevant hereto, Respondent was licensed as a registered building contractor and as a registered general contractor. On or about August 4, 1982, Hoffman, representing B & B Constructors, Inc., contracted with Vernon Swanger to build an addition to the Swanger residence at 4412 West Lelia Avenue, Tampa, Florida. The contract price for the addition to the Swanger residence was $9,150. On August 4, 1982, Swanger made the initial payment to Hoffman of $3,000 by check on this contract. Prior to the signing of this contract, Hoffman had contacted Respondent, who agreed to pull the permit for this project and who signed a blank proposal which was subsequently completed, executed by Swanger and Hoffman on 4 August 1982, and became Exhibit 2 in these proceedings. On or about August 16, 1982, Respondent obtained a permit for the addition to the Swanger residence from the City of Tampa Building Department showing Respondent as the licensed contractor for the job. Although Respondent signed the stipulation of facts that "All or the greater part of the $3,000.00 which was the first or initial payment on the contract for the Swanger addition was diverted from the construction work," Hoffman testified in Exhibit 25 that he used the $3,000 to buy materials for the project and to pay his (Hoffman's) salary for his work on the project. Under the facts here presented, Hoffman was the only one who knew for what this $3,000 had been used. In his deposition Hoffman testified that an excessive number of rainy days resulted in cost overruns resulting in insufficient money to complete the project. At no time relevant hereto was Hoffman of B & B Constructors, Inc., licensed as a contractor by the State of Florida. Respondent visited the Swanger residence once or twice while the work was in process, but all materials were ordered by Hoffman, all subcontractors were hired by Hoffman or Swanger, Hoffman was the one supervising the project, and Respondent's participation and supervision was, at best, pro forma. At no time was Respondent the qualifying agent for B & B Constructors, Inc., although Respondent briefly considered acquiring B & B Constructors, Inc., at or about the time the contract with Swanger was negotiated. The City of Tampa, Florida, is the local government with jurisdiction of the area, which is part of Hillsborough County, where Respondent is qualified as a licensed contractor. On or about January 11, 1983, as the result of a complaint filed by Swanger, Respondent's license to practice contracting in Tampa was revoked by the City of Tampa Unified Construction Trades Board. Respondent testified that he paid for the permit pulled for the Swanger project out of his own pocket and was never reimbursed by Hoffman. However, in Exhibit 25, Hoffman testified that he gave Respondent $100 in cash with which to pull the permit and his agreement with Respondent was to pay Respondent 3 percent of the contract price to pull the permit as licensed contractor.
Recommendation From the foregoing it is concluded that Respondent is guilty of all charges alleged except violation of Section 489.129(1)(h), Florida Statutes, involving diversion of funds. In view of Respondent's voluntary inactivation of his license since June 1983 it is recommended that Respondent's license be suspended for six (6) months from the date the Construction Industry Licensing Board enters its final order in this case. DONE AND ENTERED this 19th day of October 1984 at Tallahassee, Florida. K. N. AYERS Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 19th day of October 1984. COPIES FURNISHED: James H. Gillis, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 George W. Brown 11222 Russell Drive Seffner, Florida 33584 Fred M. Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 James Linnan, Executive Director Board of Construction Industry Licensing Board Department of Professional Regulation Post Office Box 2 Jacksonville, Florida 32202
