The Issue The issue in this existing rule challenge filed pursuant to section 120.56(3), Florida Statutes (2015),1/ is whether Florida Administrative Code Rule subparagraphs 59C-1.008(2)(a)2. and (2)(a)3. are invalid exercises of delegated legislative authority for the reasons alleged by Petitioner.
Findings Of Fact The Parties Petitioner is the sole existing provider of hospice services in hospice service area 5B, Pinellas County. Respondent AHCA is the state agency responsible for administering the Health Facility and Services Development Act (the Act), codified at sections 408.031 through 408.0455, Florida Statutes. The Act sets forth Florida’s certificate of need (CON) regulatory program, pursuant to which AHCA determines whether there is a community need for regulated health care facilities and services as a prerequisite to licensure and operation. As part of its responsibilities under the Act, AHCA is required to establish, by rule, uniform need methodologies for CON-regulated health facilities and services. One such need methodology, for new hospice programs, is set forth in rule 59C- 1.0355. The rule defines 27 service areas, and AHCA uses the numeric formula in rule 59C-1.0355(4)(a) to calculate numeric need for each of the 27 service areas. Other rules in chapter 59C-1 establish need methodologies for other regulated services and facilities, such as for nursing facility beds (rule 59C- 1.036), inpatient comprehensive medical rehabilitation services (rule 59C-1.039), hospital inpatient psychiatric services (rule 59C-1.040), and hospital inpatient substance abuse services (rule 59C-1.041). Intervenors Brookdale Hospice, LLC; Chapters Hospice of Pinellas County, Inc.; VITAS Healthcare Corporation of Florida; and Covenant Hospice, Inc. (collectively Intervenors), each filed a CON application to establish a new hospice program in Pinellas County, in the first batching cycle in 2015 for “other beds and programs.” The FNP Rule--What is Challenged; What is Not Challenged Rule 59C-1.008 is a lengthy rule, titled “Certificate of Need Application Procedures.” “Fixed Need Pools” is the subject of rule 59C-1.008(2). Within the “Fixed Need Pools” rule paragraph, sub-paragraph (a) addresses “Publication of Fixed Need Pools.” In its current form, it provides as follows: The Agency shall publish in the Florida Administrative Register at least 15 days prior to the letter of intent deadline for a particular batching cycle the Fixed Need Pools for the applicable planning horizon specified for each service in applicable Agency rules contained in Rules 59C-1.031- .044, F.A.C. Any person who identifies an error in the Fixed Need Pool numbers must advise the Agency of the error within 10 days of the date the Fixed Need Pool was published in the Florida Administrative Register. If the Agency concurs in the error, the Fixed Need Pool number will be adjusted and re-published in the first available edition of the Florida Administrative Register. Failure to notify the Agency of the error during this time period will result in no adjustment to the Fixed Need Pool number for that batching cycle. Except as provided in subparagraph 2. above, the batching cycle specific Fixed Need Pools shall not be changed or adjusted in the future regardless of any future changes in need methodologies, population estimates, bed inventories, or other factors which would lead to different projections of need, if retroactively applied. Petitioner has not challenged the validity of rule 59C- 1.008(2)(a)1., nor has Petitioner challenged the rest of rule 59C-1.008(2). The challenge is directed only to rule 59C- 1.008(2)(a)2. and 3. Thus, although the challenged provisions are collectively referred to for convenience as the FNP rule, in fact, the challenged provisions are only a very small part of the actual rule provisions on fixed need pools. Also not challenged by Petitioner is Florida Administrative Code Rule 59C-1.002(19), defining “fixed need pool” as follows: “Fixed Need Pool” means the identified numerical need, as published in the Florida Administrative Register, for new beds or services for the applicable planning horizon established by the Agency in accordance with need methodologies which are in effect by rule at the time of publication of the Fixed Need Pools for the applicable batching cycle. Petitioner did not challenge the validity of the fixed need pool rule provision addressing comparative review. Rule 59C-1.008(2)(e) provides in pertinent part: Comparative Review. Applications submitted to the Agency in the same batching cycle for the same service or beds having the same Certificate of Need methodology in the same district or subdistrict, as defined in applicable rules, shall be comparatively reviewed through final Agency action against the same Fixed Need Pools in existence at the initial review. The Fixed Need Pools and other relevant planning information shall be used by the Agency to review the application against all applicable statutory review criteria contained in Section 408.035, F.S., and applicable rules, and policies. Finally, Petitioner has not challenged the FNP rule on the ground that the rule is arbitrary or capricious. Although Petitioner made a few references on the record to suggest that the 10-day period to notify AHCA of a fixed need pool errors is too short, the Petition does not contend that the FNP rule is invalid because it is unreasonable, arbitrary, or capricious. Indeed, in a prior proceeding, Petitioner lauded the reasonableness of the 10-day notice period, and the importance of closing the door to any attempt to change fixed need pools for a batching cycle based on errors discovered after the 10-day period. In Petitioner’s words, the FNP rule procedures are “crafted to rapidly identify errors in the initial publication of the Fixed Need Pool so there is closure and finality. Subparagraph 3 of the rule works to ‘close the books’ on the current batching cycle so that would-be applicants have certainty: hence the term ‘Fixed’ Need.”3/ (AHCA OR-2 at 7). To address Petitioner’s legal position that the challenged FNP rule is invalid under section 120.52(8)(b), (8)(c), and the flush-left paragraph, it is helpful to consider the background evolution of the concept of comparative review under the CON program and the role of fixed need pools in carrying out that concept. Background--Evolution of Comparative Review and Fixed Need Pools Prior to 1979, the CON program, then mandated by federal law, was administered by AHCA’s predecessor, the Department of Health and Rehabilitative Services (HRS). Need was considered both at the state level and regionally, first by health systems agencies (HSAs) and later, by local health councils. HRS would make decisions on applications after considering the recommendations, if any, of the HSAs, and then applicants were entitled to “fair hearings” to contest the decision on their applications. However, there was no procedural mechanism to group together multiple pending applications seeking to address the need in the same service area for the same service, so that the competing proposals could be reviewed comparatively, in relation to each other. In the landmark case of Bio-Medical Applications of Clearwater v. Department of Health & Rehabilitative Services, 370 So. 2d 19 (Fla. 2d DCA 1979) (Bio- Medical), the court described the fundamental principle embodied in the Ashbacker doctrine, pronounced in Ashbacker Radio Corporation v. Federal Communications Commission, 326 U.S. 327, 66 S. Ct. 148, 90 L. Ed. 108 (1945): In Ashbacker, the Supreme Court laid down a general principle that an administrative agency is not to grant one application for a license without some appropriate consideration of another bona fide and timely filed application to render the same service; the principle, therefore, constitutes a fundamental doctrine of fair play which administrative agencies must diligently respect and courts must be ever alert to enforce. Bio-Medical, 370 So. 2d at 23. The court then held that this same principle required application of the Ashbacker doctrine to state CON proceedings: We are not the first to observe that where need is determined in accordance with a quantitative standard; that is, by number of units, a fixed pool of needed investments is thereby created. Opposing applicants necessarily become competitors for that fixed pool. . . . The Ashbacker court held that a comparative hearing was required where there were two applications pending . . . . Similarly, we hold that Ashbacker applies in proceedings for a certificate of need[.] Id. at 23-24. The court rejected the argument that whether applicants are entitled to comparative hearings should be addressed under the general administrative rule on consolidation (then in the model rules of procedure), requiring a motion to consolidate and vesting discretion in the hearing officer to grant or deny the motion. Instead, the court admonished: [T]he burden of initiating comparative review does not lie solely with an interested applicant. There should be a self-starting mechanism within HRS. . . . [I]t is for an administrative agency to devise means of achieving comparative consideration, including an appropriate mechanism for determination by the agency whether Ashbacker requires a comparative hearing in a particular case.[4/] . . . Neither the federal law, nor the state law (including the Administrative Procedure Act), nor the HRS rules, contain provisions establishing specific procedures for accommodating the need for comparative hearings in certificate of need proceedings. We are confident that administrative procedures will be promulgated to deal with administrative problems in affording comparative hearings, if any such problems are anticipated. Id. at 24-25. After Bio-Medical, the CON laws were amended to direct HRS to provide by rule for “applications to be submitted on a timetable or cycle basis; provide for review on a timely basis; and provide for all completed applications pertaining to similar types of services, facilities, or equipment affecting the same service area to be considered in relation to each other no less often than two times per year.” Ch. 80-187, § 4, Laws of Fla. (1980). With minor changes (to delete the reference to equipment and change the minimum cycle frequency to once yearly), this language remains intact. See § 409.039(1), Fla. Stat. Although the timetable basis for application filing helped bring about initial comparative review by HRS of similar applications, serious problems developed after HRS’s initial decisions, when administrative hearings were requested and multiple batches could be pending at the same time, with later batches sometimes being finally decided before earlier batches. In another landmark case, Gulf Court Nursing Center v. Department of Health and Rehabilitative Services, 483 So. 2d 700 (Fla. 1st DCA 1985) (Gulf Court), the court described the problems sorting out comparative review rights, which had not been well anticipated by HRS. Gulf Court held that in order to stay true to the right to comparative review in the context of the CON laws, HRS had to require that CON applications filed in a batching cycle address a specific need projection, which would be the “fixed” need pool applicable to that batching cycle.5/ Id. at 706-707. As the first step to respond to Gulf Court, HRS immediately began to interpret its need methodology rules to “fix” the data ingredients used to calculate numeric need as of HRS’s initial review of the applications, so that the numeric need could not be changed through updated data offered in administrative hearings. This interpretation, applied immediately after Gulf Court to applications reviewed in 1985, was challenged on appeal in Meridian, Inc. v. Department of Health and Rehabilitative Services, 548 So. 2d 1169 (Fla. 1st DCA 1989). The court endorsed HRS’s implementation of Gulf Court: We conclude that the construction given [the nursing facility bed need methodology rule] by HRS is neither arbitrary nor capricious, but is completely in accord with the purposes of the act and the principles of comparative review espoused in Gulf Court. The logic of HRS’s position is unassailable. It gives effect to the notion that, pursuant to applicable principles of comparative review, the number of beds in the fixed pool in the July 1985 planning cycle (July 1988) to which the applicants’ applications were addressed (as shown by the formula) would become set at July 1985 for purposes of comparative review, even though new data coming to light in later months or years might reflect a different bed need when factored into the formula. If the number of beds in the fixed pool could be altered by new information developed after the initial applications were filed, there would be no basis for ever fixing the number in the pool, and the evils in the system addressed in Gulf Court would be perpetuated. Id. at 1170-1171. As the court observed, “[T]he underlying organic statutory authority contemplates comparative review based upon a fixed pool of bed need set at the time of the initial applications.” Id. at 1171. HRS’s interpretation endorsed by the court in Meridian was refined through rule promulgation. Effective March 2, 1987, HRS adopted a “Fixed Need Pools” rule subsection, which was added to the Certificate of Need Application Procedures rule (then rule 10-5.008). The new “Fixed Need Pools” rule provided: Definition. A fixed need pool is defined as the identified need for new beds or services for the applicable planning horizon established by the department in accordance with need methodologies which are in effect by rule at the time of publication of the fixed need pools for the applicable batching cycle. Publication of Fixed Need Pools. The department shall publish in the Florida Administrative Weekly at least 15 days prior to the letter of intent deadline for a particular batching cycle the fixed need pools for the applicable planning horizon specified for each service in applicable departmental rules contained in 10-5.011, F.A.C. These batching cycle specific fixed need pools shall not be changed or adjusted in the future regardless of any future changes in need methodologies, population estimates, bed inventories, or other factors which would lead to different projections of need, if retroactively applied. Comparative Review. Applications submitted to the department in the same batching cycle for the same services in the same district or subdistrict, as defined in applicable rules, shall be comparatively reviewed through final agency action against the same fixed need pools in existence at the initial review. The fixed need pools and other relevant planning information shall be used by the department to review the application against all statutory review criteria contained in F.S. 381.494(6)(c), applicable rules, and policies. As Petitioner acknowledges, the reason why the FNP rule was adopted was to more completely “fix” the numeric need before the start of a batching cycle: Prior to the adoption of the Fixed Need Pool Rule, need was not “immutable” or a mere “historic artifact” that could not be revised after the start of a batching cycle. Instead, if AHCA preliminarily approved an application based on an erroneous need calculation, AHCA’s approval could be challenged on the basis that there is in fact no need under the rule methodology. Indeed, absent a stipulation, need would not become “fixed” (that is, not subject to correction) until the issuance of the final order and the exhaustion of any appeal. Suncoast’s Response in Opposition to the Joint Motion to Dismiss at 1 (emphasis added). The 1987 codification of the FNP rule is similar to the current provisions now found in rule 59C-1.002(19); rule 59C- 1.008(2)(a)1., 2., and 3.; and rule 59C-1.008(2)(e), quoted in paragraphs 5, 7, and 8 above. However, unlike the current FNP rule, the original FNP rule did not provide any window of time for errors to be called to HRS’s attention and corrected. The 10-day window to notify HRS of errors, as a limited exception to the “fixing” of the published numeric need, was first offered as a matter of policy and practice, as described in Health Quest Corp. v. Department of Health and Rehabilitative Services, Case No. 89-2623RX (Fla. DOAH Oct. 4, 1989), aff’d per curiam, 564 So. 2d 491 (Fla. 1st DCA 1990) (Health Quest). Health Quest determined that the original FNP rule was valid, as against a multi-faceted challenge described in more detail below. The practice of offering a 10-day window for notice of errors, initiated by HRS, was continued by AHCA as HRS’s successor beginning in 1992. When the practice was challenged as an unadopted rule, AHCA adopted the practice as a rule and the challenge was dismissed. Martin Memorial Med. Ctr. v. Ag. for Health Care Admin., Case No. 94-2917RU (Fla. DOAH Jan. 4, 1995). The codification of the 10-day window for notice of errors as a limited exception to the “fixing” of published need pools took effect October 12, 1994. The “Publication of Fixed Need Pools” rule was divided in three parts--the current form--as follows (rule changes shown in underline/strike-through format): The agency shall publish in the Florida Administrative Weekly at least 15 days prior to the letter of intent deadline for a particular batching cycle the fixed need pools for the applicable planning horizon specified for each service in applicable agency rules contained in 59C-1.031 to 59C-1.044, F.A.C. Any person who identifies an error in the fixed need pool numbers must advise the agency of the error within 10 days of publication of the number. If the agency concurs in the error, the fixed need pool number will be adjusted and re-published in the first available edition of the Florida Administrative Weekly. Failure to notify the agency of the error during this time period will result in no adjustment to the fixed need pool number for that batching cycle. Any other adjustments will be made in the first cycle subsequent to identification of an error, including those errors identified through administrative hearings or final judicial review. Except as provided in subparagraph 2. above, the These batching cycle specific fixed need pools shall not be changed or adjusted in the future regardless of any future changes in need methodologies, population estimates, bed inventories, or other factors which would lead to different projections of need, if retroactively applied. The FNP rule remained unchanged for the next ten years. In 2004, when rule 59C-1.008 was amended to reflect legislative changes (e.g., eliminating the requirement to file CON applications with local health councils, and increasing the CON application filing fee), AHCA also made two changes to rule 59C- 1.008(2)(a)2. In the first sentence, the language providing that a person must notify the agency “within 10 days of publication of the number” was changed to “within 10 days of the date the fixed need pool was published in the Florida Administrative Weekly.” This change was non-substantive, simply improving the language to make it clearer without changing the meaning. The other 2004 change was to delete the last sentence that had been in rule 59C-1.008(2)(a)2. (“Any other adjustments will be made in the first cycle subsequent to identification of an error, including those errors identified through administrative hearings or final judicial review.”). The deletion of this sentence appears to be another clean-up step, as the deleted sentence did not appear to add anything to the existing language that was left unchanged. Another 11 years have passed, with no changes to the FNP rule, except for a technical change made in 2012 when the name of the publication where fixed need pool notices would be published was changed from Florida Administrative Weekly to the Florida Administrative Register. Facts Related to Standing On April 3, 2015, AHCA published in the Florida Administrative Register the numeric fixed need pools for the review cycle with an April 20, 2015, letter-of-intent deadline. The published fixed need pool for hospice programs showed a need for one new hospice program in service area 5B. The published notice provided in pertinent part: Any person who identifies an error in the fixed need pool numbers must advise the agency of the error within ten (10) days of the publication. If the agency concurs with the error, the fixed need pool number will be adjusted and republished in the first available edition of the Florida Administrative Register. Failure to notify the agency of the error during this ten-day period waives a person’s right to raise the error at subsequent proceedings. Any other adjustments will be made in the first cycle subsequent to identification of the error including those errors identified through administrative hearings or final judicial review. Any person whose substantial interest is affected by this action and who timely advised the agency of an error in the action has a right to request an administrative hearing pursuant to Section 120.57, F.S. In order to request a proceeding under Section 120.57, F.S., a request for an administrative hearing must state with specificity which issues of material fact or law are in dispute. All requests for hearing shall be made to the Agency for Health Care Administration and must be filed with the agency clerk at 2727 Mahan Drive, Building 3, Room 3431, MS 3, Tallahassee, Florida 32308. All requests for hearing must be filed with the agency clerk within 21 days of this publication or the right to a hearing is waived. The deadline according to the notice and the challenged FNP rule to notify AHCA of alleged errors in the published fixed need pool numbers was April 13, 2015. Petitioner did not notify AHCA of an alleged error by that 10-day deadline. One other person timely notified AHCA of an alleged error, but that person withdrew the notice before AHCA made any determination. Accordingly, the 10-day deadline expired with no timely-filed pending notices of alleged errors. Intervenors timely filed letters of intent on or before the deadline of April 20, 2015, indicating their intent to file CON applications for new hospice programs in service area 5B. The deadline according to the notice and the Uniform Rules of Procedure, Florida Administrative Code Rule 28- 106.111(2), to file a request for an administrative hearing with regard to the published fixed need pools was April 24, 2015. Petitioner did not file a petition for an administrative hearing by the 21-day deadline of April 24, 2015. No evidence was presented that any other petition for administrative hearing was filed on or before April 24, 2015, to contest AHCA’s numeric need determinations set forth in the published fixed need pool notice. On May 7, 2015, AHCA issued a Final Order by which AHCA changed its interpretation of the hospice numeric need rule. Hernando-Pasco Hospice, Inc. v. Ag. for Health Care Admin., Case No. 14-5121CON (Fla. DOAH Mar. 11, 2015; Fla. AHCA May 7, 2015) (HPH). The HPH Final Order resulted from a hospice fixed need pool challenge that had been timely filed to contest the numeric need published in October 2014. The deadline to file initial CON applications addressing the fixed need pools published on April 3, 2015, was May 20, 2015. The minimum base filing fee that must be paid with the initial application filing is $10,000.00. Fla. Admin. Code R. 59C-1.008(3). Intervenors each filed initial applications, with the required filing fees, by the May 20, 2015, deadline. On June 1, 2015, Petitioner delivered a letter to AHCA notifying it of an alleged error in the hospice fixed need pool for service area 5B that had been published 59 days earlier, and requesting AHCA to correct the error. The alleged error was predicated on AHCA’s changed interpretation of the hospice numeric need rule in the May 7, 2015, HPH Final Order. While Petitioner’s June 1, 2015, letter acknowledged that notice of the alleged error was being given well outside of the 10-day window, Petitioner asserted that the 10-day period was not applicable, because AHCA was on notice by virtue of the HPH Recommended Order that its interpretation of the hospice numeric need rule was erroneous. Incongruously, Petitioner also claimed that third parties may have relied on AHCA’s position in the HPH litigation that the argument about how the hospice need rule should be interpreted did not involve an “error” cognizable in a fixed need pool challenge. The HPH Recommended Order did not accept AHCA’s litigation position in HPH that the matter was not a proper fixed need pool challenge, nor did it accept AHCA’s interpretation of the hospice need rule. But the status of the Recommended Order was just that--a recommendation, to which the parties were entitled to file exceptions for AHCA’s consideration prior to any final determination. On June 2, 2015, AHCA denied Petitioner’s request to correct the alleged error because the request was not timely filed pursuant to the challenged FNP rule. The grounds for the alleged error asserted by Petitioner did not arise until after the published fixed need pool, after the 10-day window to identify errors, and after the 21-day window to file a petition for an administrative hearing to contest the published fixed need pool. By the time the HPH Final Order established a new interpretation of the hospice need rule, with the deadlines for notifying AHCA of errors and for requesting an administrative hearing having passed with no timely-filed challenge to the published fixed need pool, applicants seeking to address the published fixed need pool reasonably relied on the existing FNP rule as having fixed for that batching cycle the numeric need published on April 3, 2015.
The Issue Whether the claimants herein are entitled to payment from the Construction Industries Recovery Fund and, if so, the amount of the payment to which each claimant is entitled. Whether the license of the Petitioner is subject to automatic suspension pursuant to Section 489.143(7), Florida Statutes (Supp. 1998).
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: The Fund is established by Section 489.140, Florida Statutes, for the purpose of reimbursing those persons who meet the eligibility requirements set forth in Section 489.141, Florida Statutes. The Board is the entity responsible for reviewing applications for payment from the Fund and entering orders approving or disapproving the applications. Sections 489.140(1) and 489.143(1), Florida Statutes. Mr. Kiselius is a licensed residential pool/spa contractor, having been first issued such a license in 1984. Mr. Kiselius's license is currently on inactive status, but at the times material to this action, Mr. Kiselius's license was active. Pool Masters was a Florida corporation incorporated on August 10, 1995. Frederick H. Martin and Abraham Zafrani were the sole shareholders of the corporation, and Mr. Martin was the President and Secretary of the corporation, and Mr. Zafrani was the Vice-President and Treasurer. From on or about October 24, 1995, until November 14, 1997, Mr. Kiselius was the qualifying agent for Pool Masters. The record does not reflect the date on which Pool Masters was issued its certificate of authority allowing it to engage in contracting as a business organization, but it was assigned Qualified Business Organization License Number QB0002327 on or about November 6, 1996. Pool Masters filed for bankruptcy pursuant to Chapter 7 of the United States Bankruptcy Code on January 1, 1998, and the corporation was administratively dissolved on October 16, 1998. DOAH Case No. 99-1665: Santibanez and Pappas Eugene Santibanez and Alexander Pappas entered into a contract with Pool Masters for construction of a swimming pool. The contract was executed on or about March 25, 1997. The total price stated in the contract was $21,000.00; a change order was executed on November 4, 1997, for an additional price of $2,890.00. Pool Masters represented to Mr. Santibanez and Mr. Pappas that it was a licensed swimming pool contractor. Pool Masters began work on the pool on or about May 17, 1997. Mr. Santibanez and Mr. Pappas made payments to Pool Masters pursuant to the contract, and Pool Masters excavated the hole for the pool, put in the foundation, and poured the concrete. Pool Masters ceased work on the swimming pool in late November 1997, after the concrete was poured. A week later, Mr. Santibanez heard that Pool Masters had declared bankruptcy. At the time Pool Masters ceased work on the pool, Mr. Santibanez and Mr. Pappas had paid Pool Masters a total of $19,690.00 for work done pursuant to the contract and change order. Although Pool Masters represented to them that the payments would be used to pay subcontractors and materialmen, there were subcontractors and materialmen who were not paid. At least one lien was filed against Mr. Santibanez's and Mr. Pappas's property, and they paid the subcontractors and materialmen directly in order to get the liens released. On January 17, 1998, the United States Bankruptcy Court for the Southern District of Florida issued a Notice of Commencement of Case Under Chapter 7 of the Bankruptcy Code, showing that Pool Masters had filed for bankruptcy on January 7, 1998. On or about March 11, 1998, Mr. Santibanez and Mr. Pappas submitted a Construction Industries Recovery Fund Claim Form to the Board, naming Pool Masters as the contractor. In an order entered April 20, 1998, the bankruptcy court lifted the automatic stay to allow Mr. Santibanez and Mr. Pappas to file suit against Pool Masters. Mr. Santibanez and Mr. Pappas filed a complaint against Pool Masters in the Circuit Court for the Seventeenth Judicial Circuit in Broward County, Florida, seeking damages for breach of the contract for construction of the pool. Mr. Santibanez and Mr. Pappas alleged in the complaint that Pool Masters had failed to complete the work; failed to perform in a reasonable and timely manner and abandoned the project for more than 90 days which is a violation of F.S. 489.129(1)(k) [Section 489.129(1)(j)];[ 3/ ] falsely represented that monies paid to them were paid to materialmen and sub- contractors which resulted in financial harm to the Plaintiffs which is a violation of F.S. 489.129(1)(l) [Section 489.129(1)(k)];[ 4/ ] committed mismanagement and misconduct which caused Plaintiffs financial harm as of [sic] liens were recorded as against the Plaintiff's [sic] home in violation of F.S. 489.129(1)(h)(1) [Section 489.129(1)(g)1.];[ 5/ ] f [sic]. committed mismanagement and misconduct which caused Plaintiffs financial harm in that the percentage of completion is less than the percentage of the total contract price paid in violation of F.S. 489.129(1)(h)(2) [Section 489.129(1)(g)2.].[ 6/ ] Mr. Santibanez and Mr. Pappas further alleged in the complaint that the cost to complete the pool after construction was abandoned by Pool Masters was $17,975.50, and they included in the complaint an itemized list of expenditures to support their claim. The circuit court entered a Default Final Judgment on August 4, 1998, awarding Mr. Santibanez and Mr. Pappas $17,675.50, to be recovered from Pool Masters, plus interest at the statutory rate. In a letter from their attorney dated August 12, 1998, Mr. Santibanez and Mr. Pappas submitted to the Board additional documents to support their claim against the Construction Industries Recovery Fund, based on their Default Final Judgment against Pool Masters. The final report of the Trustee of Pool Masters' bankruptcy estate, dated December 1, 1999, indicated that Pool Masters had no funds remaining after disbursement for administrative expenses. Mr. Santibanez and Mr. Pappas did not receive any funds from the bankruptcy estate or any other source to satisfy the judgment against Pool Masters. Mr. Santibanez and Mr. Pappas satisfy the statutory criteria for eligibility for payment from the Fund in the amount of $17,675.50. DOAH Case No. 99-1666: Klaus and Lucrecia Mueller Klaus and Lucrecia Mueller entered into a contract with Pool Masters for construction of a swimming pool. The contract was executed on or about February 24, 1997. The total price stated in the contract was $16,400.00. Pool Masters represented to Mr. and Mrs. Mueller that it was a licensed swimming pool contractor. Pool Masters began work on the pool in Spring 1997, and Mr. and Mrs. Mueller made payments to Pool Masters pursuant to the contract. Pool Masters excavated the hole for the pool, installed the steel frame, poured gunnite at the shallow end of the pool, and installed the brick and tile around the pool. Pool Masters last worked on the swimming pool in late November 1997. At the time Pool Masters ceased work on the pool, Mr. and Mrs. Mueller had paid Pool Masters approximately $12,900.00 for work done pursuant to the contract. Although Pool Masters represented to them that the payments would be used to pay subcontractors and materialmen, there were subcontractors and materialmen who were not paid. Liens were filed against Mr. and Mrs. Mueller's property, and they paid the subcontractors and materialmen directly in order to get the liens released. On January 17, 1998, the United States Bankruptcy Court for the Southern District of Florida issued a Notice of Commencement of Case Under Chapter 7 of the Bankruptcy Code, showing that Pool Masters had filed for bankruptcy on January 7, 1998. On or about March 11, 1998, Mr. and Mrs. Mueller submitted a Construction Industries Recovery Fund Claim Form to the Board, naming Pool Masters as the contractor. In an order entered April 20, 1998, the bankruptcy court lifted the automatic stay to allow Mr. and Mrs. Mueller to file suit against Pool Masters. Mr. and Mrs. Mueller filed a complaint against Pool Masters in the Circuit Court for the Seventeenth Judicial Circuit in Broward County, Florida, seeking damages for breach of the contract for construction of the pool. Mr. and Mrs. Mueller alleged in the complaint that Pool Masters had failed to complete the work; failed to perform in a reasonable and timely manner and abandoned the project for more than 90 days which is a violation of F.S. 489.129(1)(k) [Section 489.129(1)(j)];[ 7/ ] falsely represented that monies paid to them were paid to materialmen and sub- contractors which resulted in financial harm to the Plaintiffs which is a violation of F.S. 489.129(1)(l) [Section 489.129(1)(k)];[ 8/ ] committed mismanagement and misconduct which caused Plaintiffs financial harm as of [sic] liens were recorded as against the Plaintiff's [sic] home in violation of F.S. 489.129(1)(h)(1) [Section 489.129(1)(g)1.];[ 9/ ] f [sic]. committed mismanagement and misconduct which caused Plaintiffs financial harm in that the percentage of completion is less than the percentage of the total contract price paid in violation of F.S. 489.129(1)(h)(2) [Section 489.129(1)(g)2.].[ 10/ ] Mr. and Mrs. Mueller further alleged in the complaint that the cost to complete the pool after construction was abandoned by Pool Masters was $13,299.51. The matter was presented to the circuit court, ex parte, upon Mr. and Mrs. Mueller's Motion for Default Final Judgment. The court entered a Default Final Judgment in June 1998, awarding Mr. and Mrs. Mueller $13,299.51, to be recovered from Pool Masters, plus interest at the statutory rate. In a letter from their attorney dated June 23, 1998, Mr. and Mrs. Mueller submitted to the Board additional documents to support their claim against the Construction Industries Recovery Fund, based on their Default Final Judgment against Pool Masters. The final report of the Trustee of Pool Masters' bankruptcy estate, dated December 1, 1999, indicated that Pool Masters had no funds remaining after disbursement for administrative expenses. Mr. and Mrs. Mueller did not receive any funds from the bankruptcy estate or any other source to satisfy their judgment against Pool Masters. Mr. and Mrs. Mueller satisfy the statutory criteria for eligibility for payment from the Fund in the amount of $13,299.51. DOAH Case No. 99-1667: Mario and Martha Alboniga Mario and Martha Alboniga entered into a contract with Pool Masters for construction of a swimming pool. The contract was executed on or about March 17, 1997. The total price stated in the contract was $24,000.00. Pool Masters represented to Mr. and Mrs. Alboniga that it was a licensed swimming pool contractor. Pool Masters began work on the pool on November 10, 1997, and Mr. and Mrs. Alboniga made payments to Pool Masters pursuant to the contract. Pool Masters excavated the hole for the pool and poured the concrete form of the pool. The last day Pool Masters worked on the swimming pool was November 19, 1997. Mr. and Mrs. Alboniga later heard that Pool Masters had declared bankruptcy. At the time Pool Masters ceased work on the pool, Mr. and Mrs. Alboniga had paid Pool Masters a total of $15,200.00 for work done pursuant to the contract. Although Pool Masters represented to them that the payments would be used to pay subcontractors and materialmen, there were subcontractors and materialmen who were not paid. Liens were filed against Mr. and Mrs. Alboniga’s property, and they paid the subcontractors and materialmen directly in order to get the liens released. On January 17, 1998, the United States Bankruptcy Court for the Southern District of Florida issued a Notice of Commencement of Case Under Chapter 7 of the Bankruptcy Code, showing that Pool Masters had filed for bankruptcy on January 7, 1998. On or about March 11, 1998, Mr. and Mrs. Alboniga submitted a Construction Industries Recovery Fund Claim Form to the Board, naming Pool Masters as the contractor. In an order entered April 20, 1998, the bankruptcy court lifted the automatic stay to allow Mr. and Mrs. Alboniga to file suit against Pool Masters. Mr. and Mrs. Alboniga filed a complaint against Pool Masters in the Circuit Court for the Seventeenth Judicial Circuit in Broward County, Florida, seeking damages for breach of the contract for construction of the pool. Mr. and Mrs. Alboniga alleged in the complaint that Pool Masters had failed to complete the work; failed to perform in a reasonable and timely manner and abandoned the project for more than 90 days which is a violation of F.S. 489.129(1)(k) [Section 489.129(1)(j)];[ 11/ ] falsely represented that monies paid to them were paid to materialmen and sub- contractors which resulted in financial harm to the Plaintiffs which is a violation of F.S. 489.129(1)(l) [Section 489.129(1)(k)];[ 12/ ] committed mismanagement and misconduct which caused Plaintiffs financial harm as of [sic] liens were recorded as against the Plaintiff's [sic] home in violation of F.S. 489.129(1)(h)(1) [Section 489.129(1)(g)1.];[ 13/ ] f [sic]. committed mismanagement and misconduct which caused Plaintiffs financial harm in that the percentage of completion is less than the percentage of the total contract price paid in violation of F.S. 489.129(1)(h)(2) [Section 489.129(1)(g)2.].[ 14/ ] Mr. and Mrs. Alboniga further alleged in the complaint that the cost to complete the pool after construction was abandoned by Pool Masters was $10,541.77. The circuit court entered a Final Judgment "pursuant to stipulation" on August 4, 1998, awarding Mr. and Mrs. Alboniga $10,541.77, to be recovered from Pool Masters, plus interest at the statutory rate. In a letter from their attorney dated August 12, 1998, Mr. and Mrs. Alboniga submitted to the Board additional documents to support their claim against the Construction Industries Recovery Fund, based on their Final Judgment against Pool Masters. The final report of the Trustee of Pool Masters' bankruptcy estate, dated December 1, 1999, indicated that Pool Masters had no funds remaining after disbursement for administrative expenses. Mr. and Mrs. Alboniga did not receive any funds from the bankruptcy estate or any other source to satisfy their judgment against Pool Masters. Mr. and Mrs. Alboniga satisfy the statutory criteria for eligibility for payment from the Fund in the amount of $10,541.77. DOAH Case No. 99-1668: Salvator Militello and Sharon Sidorski Salvator Militello and Sharon Sidorski entered into a contract with Pool Masters for construction of a swimming pool. The contract was executed on or about April 6, 1997. The total price stated in the contract was $24,295.00. Pool Masters represented to Mr. Militello and Ms. Sidorski that it was a licensed swimming pool contractor. Mr. Militello and Ms. Sidorski made payments to Pool Masters pursuant to the contract. Pool Masters excavated the hole for the pool and spa, installed basic plumbing, and poured the concrete for the pool. Pool Masters last worked on the swimming pool in October 1997. At the time Pool Masters ceased work on the pool, Mr. Militello and Ms. Sidorski had paid Pool Masters $19,389.00 for work done pursuant to the contract. Although Pool Masters represented to them that the payments would be used to pay subcontractors and materialmen, there were subcontractors and materialmen who were not paid. Liens were filed against Mr. Militello's and Ms. Sidorski's property, and they paid the subcontractors and materialmen directly in order to get the liens released. On January 17, 1998, the United States Bankruptcy Court for the Southern District of Florida issued a Notice of Commencement of Case Under Chapter 7 of the Bankruptcy Code, showing that Pool Masters had filed for bankruptcy on January 7, 1998. On or about March 11, 1998, Mr. Militello and Ms. Sidorski submitted a Construction Industries Recovery Fund Claim Form to the Board, naming Pool Masters as the contractor. In an order entered April 20, 1998, the bankruptcy court lifted the automatic stay to allow Mr. Militello and Ms. Sidorski to file suit against Pool Masters. Mr. Militello and Ms. Sidorski filed a complaint against Pool Masters in the Circuit Court for the Seventeenth Judicial Circuit in Broward County, Florida, seeking damages for breach of the contract for construction of the pool. Mr. Militello and Ms. Sidorski alleged in the complaint that Pool Masters had failed to complete the work; failed to perform in a reasonable and timely manner and abandoned the project for more than 90 days which is a violation of F.S. 489.129(1)(k) [Section 489.129(1)(j)];[ 15/ ] falsely represented that monies paid to them were paid to materialmen and sub- contractors which resulted in financial harm to the Plaintiffs which is a violation of F.S. 489.129(1)(l) [Section 489.129(1)(k)];[ 16/ ] committed mismanagement and misconduct which caused Plaintiffs financial harm as of [sic] liens were recorded as against the Plaintiff's [sic] home in violation of F.S. 489.129(1)(h)(1) [Section 489.129(1)(g)1.];[ 17/ ] f [sic]. committed mismanagement and misconduct which caused Plaintiffs financial harm in that the percentage of completion is less than the percentage of the total contract price paid in violation of F.S. 489.129(1)(h)(2) [Section 489.129(1)(g)2.].[ 18/ ] Mr. Militello and Ms. Sidorski further alleged in the complaint that the cost to complete the pool after construction was abandoned by Pool Masters was $13,544.00 and that they paid $1,641.68 to satisfy liens and unpaid subcontractors and materialmen, for total damages of $15,185.68. The circuit court entered a Final Judgment "pursuant to stipulation" on August 4, 1998, awarding Mr. Militello and Ms. Sidorski $15,185.68, to be recovered from Pool Masters, plus interest at the statutory rate. In a letter from their attorney dated August 12, 1998, Mr. Militello and Ms. Sidorski submitted to the Board additional documents to support their claim against the Construction Industries Recovery Fund, based on their Final Judgment against Pool Masters. The final report of the Trustee of Pool Masters' bankruptcy estate, dated December 1, 1999, indicated that Pool Masters had no funds remaining after disbursement for administrative expenses. Mr. Militello and Ms. Sidorski did not receive any funds from the bankruptcy estate or any other source to satisfy their judgment against Pool Masters. Mr. Militello and Ms. Sidorski satisfy the statutory criteria for eligibility for payment from the Fund in the amount of $15,185.68. DOAH Case No. 00-0024: Jack and Paula Tieger Jack and Paula Tieger entered into a contract with Pool Masters for construction of a swimming pool. The contract was executed on or about December 17, 1995. The total price stated in the contract was $28,200.00. Pursuant to the contract, Pool Masters built a pool and screen enclosure, and Mr. and Mrs. Tieger paid Pool Masters the price specified in the contract. Mr. and Mrs. Tieger were not, however, satisfied with the work done by Pool Masters, and, in or around 1997, they filed a complaint for breach of contract against Pool Masters in the Circuit Court of the Seventeenth Judicial Circuit, in Broward County, Florida. In the complaint, Mr. and Mrs. Tieger alleged that Pool Masters had breached the contract: By failing to adequately explain the technical terms used in the Agreement to the TIEGERS; By failing to install a vacuum line with valve as specified in the Agreement; By failing to install anti-corrosive handrails in the swimming pool; By failing to properly install and/or provide a properly functioning waterfall as specified in the Agreement; By failing to properly fill the area behind the waterfall; By unilaterally, and or the TIEGERS' [sic] objection, placing a tile with the "Pool Masters" logo on the steps heading into the pool: By failing to re-route the TIEGERS' [sic] sprinkler system in a timely manner; By failing to advise the TIEGERS that they were going to need to pay for and install a separate circuit breaker box as part of the installation of the swimming pool; and By failing to install the second screen door as specified in the Agreement. Mr. and Mrs. Tieger did not identify the amount of damages they allegedly suffered as a result of Pool Masters's alleged breach of contract. Mr. and Mrs. Tieger were not aware that Pool Masters had declared bankruptcy until January 1998, when Mrs. Tieger went to Pool Masters' office and found the notice on the door. A non-jury trial was held before the circuit court on March 5, 1998; Pool Masters did not attend the trial. In a Final Judgment entered on March 25, 1998, the court awarded Mr. and Mrs. Tieger $4,200 as compensatory damages to be recovered from Pool Masters. In a Proof of Claim dated May 13, 1998, and filed with the United States Bankruptcy Court of the Southern District of Florida, Mr. and Mrs. Tieger submitted an unsecured claim against Pool Masters' bankruptcy estate in the amount of $7,300.00, which represented the compensatory damages awarded in the final judgment, together with attorney's fees and costs. Mr. and Mrs. Tieger have not collected any portion of their judgment against Pool Masters. Mr. and Mrs. Tieger submitted to the Board a Construction Industries Recovery Fund Claim Form dated December 5, 1998, and the Board awarded Mr. and Mrs. Tieger $800.00, representing the cost of the vacuum line with valve and the second screen door which Pool Masters had not installed. Mr. and Mrs. Tieger do not satisfy the statutory criteria for eligibility for payment from the Fund. Mr. and Mrs. Tieger failed to establish that they filed their claim with the Board within two years of the date they discovered the alleged deficiencies in the pool, and they failed to establish that the final judgment against Pool Masters was based on a violation of Section 489.129(1)(g), (j), or (k), Florida Statutes (Supp. 1998). The evidence presented herein is not sufficient to establish that Mr. Kiselius is the licensee against whom the claimants obtained final judgments.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, 25/ it is RECOMMENDED that the Construction Industry Licensing Board: Enter final orders as follows: In DOAH Case No. 99-1665, finding Eugene Santibanez and Alexander Pappas eligible for payment from the Fund in the amount of $17,675.00, in satisfaction of a final judgment against Pool Masters, Inc.; In DOAH Case No. 99-1666, finding Klaus and Lucrecia Mueller eligible for payment from the Fund in the amount of $13,299.51, in satisfaction of a final judgment against Pool Masters, Inc.; In DOAH Case No. 99-1667, finding Mario and Martha Alboniga eligible for payment from the Fund in the amount of $10,541.77, in satisfaction of a final judgment against Pool Masters, Inc.; In DOAH Case No. 99-1668, finding Salvator Militello and Sharon Sidorski eligible for payment from the Fund in the amount of $15,185.68, in satisfaction of a final judgment against Pool Masters, Inc.; and In DOAH Case No. 00-0024, dismissing the claim of Jack and Linda Tieger for payment from the Fund. Determine that Christopher P. Kiselius is not the "licensee" whose license is subject to automatic suspension pursuant to Section 489.143(7), Florida Statutes (Supp. 1998), as a result of payments to the claimants in DOAH Case Nos. 99- 1665, 99-1666, 99-1667, and 99-1668. DONE AND ENTERED this 31st day of August, 2000, 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 31st day of August, 2000.
Findings Of Fact Petitioner is the state agency charged, in conjunction with the Construction Industry Licensing Board, with the responsibility to prosecute Administrative Complaints pursuant to Chapters 489, 455, and 120 F.S., and the rules promulgated thereunder. At all times material to the Administrative Complaint herein, Respondent was licensed as a certified pool contractor in the State of Florida, holding license number CP 0009588. At all times material hereto, Respondent was the qualifying agent for Pools by L. S. Rule. On August 12, 1987, Ms. Mary Tillotson forwarded a $1,200 check to Pools by L. S. Rule for pool repair work including replacing the existing pool skimmer and furnishing and installing one row of new tile and remarcite. Respondent estimated the job would require two weeks to complete. On August 24, 1987, Ms. Tillotson formally entered into a written contract with Pools by L. S. Rule to perform the aforementioned pool repairs at her residence of 2110 North 41st Avenue, Hollywood, Florida for a price of $2,330.00. The contract actually signed by the parties, which is the contract which governs this case did not specify a completion date or state that "time is of the essence" for the job; however, the Respondent was clearly aware as of August 11, 1987 that Ms. Tillotson wanted the pool repaired by approximately August 24 or 25. On August 24, 1987, an employee of Pools by L. S. Rule removed the old skimmer from Ms. Tillotson's pool and replaced it with a new skimmer the next day. There was no further work done on Ms. Tillotson's pool by Pools by L. S. Rule after August 25, 1987. Ms. Tillotson contacted the Respondent repeatedly and the Respondent informed her that he was having an employment problem, but would have someone come out the next day. Neither the Respondent nor any of his employees ever visited the Tillotson residence again, with the exception of a brief visit by one employee wherein no work was performed. Ms. Tillotson discharged the Respondent on September 10, 1987, fifteen days or roughly two weeks after the contract was entered into and approximately the date the pool was supposed to have been completed. Upon cancellation, Ms. Tillotson demanded a refund of her entire $1200 deposit. Ms. Tillotson contracted with Adonis Pools, on September 11, 1987 to perform the same repairs as she had requested of Respondent. The repairs were completed by Adonis within three days. During the time of the Tillotson contract, Respondent proceeded with the construction of approximately five pools and maintained a staff of five employees. The reason offered at hearing for failure to proceed with Ms. Tillotson's pool was that he had lost a key employee and there had been rain delays. On September 21, 1987, Ms. Tillotson wrote the Respondent and requested a refund of $920, a compromise amount less than the full $1200 deposit, reflecting what she believed accounted for the services and material already expended by Respondent and Pools by L. S. Rule. Respondent refused to refund any of the deposit unless the amount were compromised upon his terms and Ms. Tillotson refused to accept what she regarded as partial payment. Ms. Tillotson filed suit against Respondent in November, 1987. She was awarded a judgment for $875 plus $54 in court costs, in the County Court in and for Broward County, Florida on April 20, 1988. The Respondent did not pay Ms. Tillotson the award monies on the date of judgment. He had already spent some of her deposit elsewhere. The Respondent has since failed to refund any portion of the deposit. The efforts Respondent has expended to negotiate or pay the judgment do not reflect good faith attempts at full payment under the judgment. Frank Abbott is a certified general contractor and a registered Florida Architect. Mr. Abbott was retained and tendered by the Department of Professional Regulation (DPR) as its expert witness on the duties and responsibilities of contractors in the construction of pools; he was accepted as such over objection. It was Mr. Abbott's opinion that the Tillotson pool job should have taken one or two weeks, and upon the material in the DPR's investigative file, he concluded that abandonment by Respondent had occurred; that because the contractor accepted a deposit, failed to perform, and did not return any funds, there had been financial misconduct; and that therefore Respondent was guilty of gross negligence or incompetence. However, Mr. Abbott never spoke to Tillotson or Rule, never saw the area, the job, or assessed the weather conditions. He saw only a poor xerox copy of the photograph of the skimmer installation which was ultimately admitted as P-5. He offered no narrative of what constituted gross negligence as far as the skimmer job was concerned and merely offered his own legal conclusion that abandonment and financial mismanagement constitute incompetence or gross negligence. Some of his opinion was based on the way he operates his own contracting business, rather than upon general education, training, and experience in the contracting profession. He had personally supervised the building of only a few pools and only had connection with building eleven pools. He had never personally built a pool or done any pool work or received any specific pool training. In drawing his conclusions and in forming his opinion, Mr. Abbott also made assumptions with regard to characterizations in the DPR investigative file which were either not necessarily supported by the greater weight of the credible evidence as a whole as presented at formal hearing or which were extraneous to the issues in the specific case at bar. Petitioner presented no evidence of any kind bearing on the charge that Respondent failed to timely secure a building permit.
Recommendation Upon the foregoing findings of fact and conclusions of law, it is recommended that the Construction Industry Licensing Board enter a final order dismissing the charges against Respondent under Sections 489.129(1)(j) and (m) F.S, finding him guilty of violating Sections 489.129(1)(h) and (k) F.S., and imposing a $1,750 fine. DONE and RECOMMENDED this 19th day of December, 1988, Tallahassee, Florida. ELLA JANE P. DAVIS, 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 December, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 88-3312 The following constitute specific rulings upon the parties' respective proposed findings of fact (PFOF) pursuant to Section 120.59(2) F.S. Petitioner's PFOF 1-11 Accepted, and with minor modifications of style, are adopted. 12-13 Accepted in substance but modified to conform to the greater weight of the credible evidence. 14-16 The expert opinions of Mr. Abbott are recited within the Recommended Order (RO), but were of little assistance to the trier of fact since they were mostly rendered in terms of raw conclusions of law rather than contracting expertise. To the extent they are credible and supported by the greater weight of the factual evidence of record, they have been accepted in the RO. For the most part they have been rejected for the aforesaid reason and for the reasons set out in FOF 14 and the Conclusions of Law (COL). Respondent's PFOF 1-9, and 22 Accepted. 10-11 Out of chronological context and thereby misleading as to the record evidence; for this reason and for the reason they are subordinate to the facts as found, they are rejected. 12 Sentence 1 is accepted. Sentence 2 is also out of chronological context and thereby misleading as to the record evidence and for this reason and for the reason it is immaterial, it is rejected. 13-14 Rejected as stated as not supported by the record evidence as a whole and as set out in FOF 13. 15-17 and 20 Rejected as not PFOF but proposed COL. 18-19 and 21 (on page 3 and on page 4) are partially accepted in substance in FOF 14 but otherwise are rejected as mere argument of counsel or as unnecessary. COPIES FURNISHED: Fred Seely, Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32201 G. W. Harrell, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399 Donald N. Bensen, Esquire 301 Southeast 10th Court Ft. Lauderdale, Florida 33316 Bruce D. Lamb, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750
The Issue The administrative complaint filed on September 17, 1987 alleges that in a residential pool contracting job Respondent Martin ". . . exhibited financial mismanagement, misconduct, or diversion, in violation of 489.129(1)(h), (m) . . . [and] failed to perform in a reasonably timely manner, and/or abandoned said job, in violation of 489.129(1)(m), (k)." The issue is whether Martin committed those violations, and if so, what disciplinary action is appropriate.
Findings Of Fact At all times relevant, Kenneth Martin was licensed in the State of Florida as a registered commercial pool contractor, holding license number RP 0021608. His license is currently in inactive status. Martin was President of Adair Pools, Inc., the corporation under which he conducted his pool construction business. In early July 1986, Adair Pools contracted to build a residential pool for Paul and Cynthia Pajak at 8304 Helena Drive in Orange County, Florida. The pool was to be kidney-shaped, approximately 14 feet by 30 feet, with a waterfall and a detached spa. The contract amount of $11,571.00 expressly excluded the deck, electrical work and screening, although the written contract included a sheet describing the specifications for the excluded work, recommended contractors, and estimated costs. This sheet and the pool contract itself clearly indicated that these items were not the responsibility of the pool company and were not included in the contract price. Work commenced in July, shortly after the contract was signed. Although the contract did not specify a completion date, Martin concedes that the pool should have taken no more than four to eight weeks to complete. The Pajaks had planned a Labor Day party and were told by Adair's employees there would be no problem getting their pool finished for the party. The pool was not finished by Labor Day. After the pool was dug, shot with concrete and tiled, someone determined that the spa was supposed to have been raised. In attempting to raise the spa and to change the water jets, the workers cracked the shell of the spa and had to replace it. Until the problems with the spa, the Pajaks felt that the construction progress was reasonable and smooth. At this point, sometime around Labor Day, the problems began. Adair delayed in paying Shotcrete Pools, the subcontractor for the concrete shell, because Adair felt it was Shotcrete's fault that the spa was cracked. Shotcrete notified the Pajaks that a lien would be placed on the property if they were not paid. The notice to owner is dated November 3, 1986. Eventually Adair paid Shotcrete and its other subcontractors for the Pajak work and no lien was filed. The evidence does not reflect a clear sequence of events, but between Labor Day and February or March 1987, little progress was made to finish the pool. Martin's supervisor left and Martin's brother took over. The Pajaks kept calling Martin and were always assured that the job would be completed. Martin admits that the company at this time was in serious financial trouble because it was not being paid for a large commercial job that it had undertaken. On December 10, 1986, Mrs. Pajak's brother-in-law, an attorney, sent Martin a demand letter, giving a 10-day deadline for completion of the work. Martin and his brother met with the attorney and assured him the job would be finished. In spite of the problems, the Pajaks continued working with Martin and paid the full contract price, less the $100.00 that was to be paid when the pool was filled. On March 5, 1987, Martin informed the Pajaks that they should have the deck poured so that Adair could finish the pool. The Pajaks were not satisfied that the pool was ready for the deck as there were leaks in the waterfall, debris was all over the yard and the spa tile work looked messy. In Martin's opinion those items were his company's responsibility, but were part of the finishing to be done after the deck was poured and the pool was lined with marblelite. On March 21, 1987, the Pajaks contracted with another pool company for $4450.00 to finish their pool. Martin denies that Adair abandoned the job, but admits that it took an inordinate amount of time. The Pajaks did not allow him to finish the cleanup, the interior coating and the pool start up because they contracted with someone else. Martin did not contest that the waterfall leaked or that extensive cleanup needed to be done, but disputed that this work should be done before the deck was poured. He contended that the leaks in the waterfall would have been fixed when the finish was done. Martin estimates that between 1974 and 1986, his company completed over fourteen hundred residential pools and approximately five hundred large commercial pools. Martin has been active on various local pool construction industry boards and has no record of prior disciplinary action against his license.
Recommendation Based upon the foregoing, it is, hereby, RECOMMENDED: That Kenneth Martin be found guilty of misconduct, in violation of Section 489.129(1)(m), Florida Statutes, not guilty of the other violations with which he is charged, and that he be required to pay an administrative fine of $500.00. DONE and RECOMMENDED this 2nd day of August, 1988, in Tallahassee, Florida. MARY CLARK 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 2nd day of August, 1988. COPIES FURNISHED: David E. Bryant, Esquire 220 East Madison Street, Suite 530 Tampa, Florida 33602 Kenneth R. Martin 3225 North Glenn Drive Orlando, Florida 32806 Fred Seely, Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32201 William O'Neil, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32399-0750 =================================================================
The Issue Whether Respondent's license as a pool contractor should be disciplined and, if so, what penalty to recommend.
Findings Of Fact At all times relevant hereto John A. Bennett, Respondent, was licensed by the Florida Construction Industry Licensing Board as a residential pool contractor, having been issued license number RP 0033592. He is the qualifying contractor for Quality Pools and Products, Inc., 2912 Forest Wood Drive, Seffner, Florida 33584 (Exhibit 2). On or about January 25, 1988, Evelyn L. Dittmer and James W. Dittmer entered into a contract with Quality Aquatech Pools & Spas (Quality Pools), 1500 N. Parsons Avenue, Brandon, Florida, to replace the liner and repair the bottom of the pool (Exhibit 5). This contract was signed by the Dittmers and Andy Priess, presumably the foreman of Quality Pools. The Dittmers never met Respondent, but they "understood" he owned the pool company. Printed on the bottom of Exhibit 1 is Respondent's state registration number. Employees of Quality Pools arrived on the site and removed the old liner. At this time, the bottom of the pool was in bad shape, but the workers attempted to replace the liner without repairing the bottom of the pool. They were stopped from replacing the liner and departed as they had brought no equipment with which to repair the bottom. Workers returned for the next several days to attempt to repair the bottom of the pool. Due to excessive ground water entering the pool, this task was onerous. The initial contract provided that if it became necessary to establish well points to keep excess water out of the pool, an additional fee of $200 would be required. The Dittmers paid this fee, but well points were not established. An addendum to the contract was prepared for additional work needed to get the bottom of the pool back in shape (Exhibit 1) and was signed by John A. Bennett. This provided for an additional payment of $600, but was not accepted or signed by the Dittmers. The new liner was ultimately installed, but was torn in the process and the unnatural hole in the bottom of the pool was not repaired. Although the Dittmers had paid Quality Pools the full contract price of $2700, which included a $200 charge for installing well points, the work was never satisfactorily completed, and Quality Pools failed to perform the work for which they had contracted. The project was finally abandoned by Quality Pools, and two of the pumps used to dewater the pool were left on the site. At no time did anyone from Quality Pools obtain a permit from Sarasota County where this work was done, and Quality Pools was not licensed to work in Sarasota County (Exhibit 3). After it became evident Quality Pools would not complete the repairs for which they had contracted, the Dittmers hired another contractor to whom they paid an additional $2945 to restore the pool to an operating condition (Exhibit 7).
Recommendation It is recommended that the charges against John A. Bennett arising out of the contract between the Dittmers and Quality Aquatech Pools & Spas be dismissed. RECOMMENDED this 5th day of January, 1990, in Tallahassee, Florida. K. N. AYERS Hearing Officer Division of Administrative Hearings The Desoto Building 1230 Apalachee Parkway Tallahassee, FL (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 5th day of January, 1990. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-4839 Proposed findings submitted by Petitioner are accepted with the exception of findings 3, 4, 5, 6, 7, 8, 11, 13, 14, 15, 16 and 17 which are rejected for the reason that the evidence submitted does not show Respondent to be the owner or qualifying contractor of Quality Aquatech Pools and Spas with whom the Dittmers contracted. Findings of fact cannot be founded in uncorroborated hearsay evidence not admissible over objection in civil proceedings. COPIES FURNISHED: Andrea Bateman, Esquire Department of Professional Regulation Northwood Centre 1940 North Monroe Street Suite 60 Tallahassee, FL 32399-0792 Michael S. Edenfield, Esquire 206 E. Mason Street Brandon, FL 33511 John A. Bennett 1500 Parsons Avenue Brandon, FL 33511 Fred Seely Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, FL 32201 Kenneth E. Easley General Counsel Department of Professional Regulation 1940 N. Monroe Street Suite 60 Tallahassee, FL 32399-0792 =================================================================
Findings Of Fact Atlas Pools, Inc., contracted with Mr. and Mrs. Jerry Thompson in May, 1978, to construct a swimming pool on the Thompson property for a completed price of $5,940. Work ceased in mid-July, 1978, by which time the Thompsons had paid Atlas Pools $5,643. The Thompsons hired another pool contractor to complete the project at additional cost in excess of $2,000. Atlas Pools contracted with Mr. and Mrs. Dennis Perry in June, 1978, to construct a swimming pool on the Perry property for a completed cost of $5,770. Work ceased in late July, 1978, after the Perrys had paid Atlas Pools $5,474.50. The Perrys completed the project through self-help and use of another pool contractor at a further cost of $1,566. Atlas Pools contracted with Mr. and Mrs. Thomas Wolters in June, 1978, to construct a swimming pool on the Wolters' property for a completed cost of $6,980. Work ceased in mid-July, 1978, after the Wolters had paid Atlas Pools $6,631. The Wolters completed the pool through self help at an additional cost in excess of $1,300. Atlas Pools contracted with Mr. and Mrs. Albert Sentman in June, 1978, to construct a spa on the Sentman property for a completed cost of $5,500. The Sentmans paid Atlas Pools a $550 deposit after which the spa was delivered but not installed. The Sentmans completed the project by other means at an additional cost of $6,137. Respondent abandoned each of the above projects without notice to the customer, who ultimately learned of the company's bankruptcy from a third party source. Each of the four projects described above was completed at a final cost to the purchaser in excess of $900 over the contract price. The company filed a Voluntary Petition of Bankruptcy with the U.S. District Court, Middle District of Florida, on August 1, 1978. Thereafter, on March 7, 1979, the Brevard County Contractors Licensing Board revoked the certificate held by Atlas Pools for a minimum period of one year, with the requirement that financial rehabilitation be demonstrated as a condition of reinstatement. At the time of bankruptcy, Respondent was president of Atlas Pools, Inc., and owned one-third of the stock. He was, at all times relevant to this proceeding, the company's only licensed pool contractor. He is currently employed in pool construction work by a licensed contractor. Proposed findings of fact were submitted by the parties. To the extent these proposed findings have not been adopted herein or are inconsistent with the above findings, they have been specifically rejected as irrelevant or not supported by the evidence.
Recommendation Based on the foregoing, it is RECOMMENDED: That Pool Contractor's License No. RP 0018040 issued to Crawford L. Grove, be suspended until Respondent demonstrates compliance with the financial responsibility standards established by Section 489.115, Florida Statutes (1979). DONE AND ENTERED this 29th day of October, 1980, in Tallahassee, Florida. R. T. CARPENTER Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 FILED with the Clerk of the Division of Administrative Hearings this 29th day of October, 1980.
