Findings Of Fact This case concerns what is-called a "Turnkey Lease". The program was developed by the State of Florida in 1971. It encompasses a situation where by agencies seeking space for their operations may, after a specific need is determined that cannot be filled by existing adequate space, solicit competitive bids from developers for the provision of land and the construction of a building thereon sufficient to-meet the agency's needs, for lease specifically to the agency requesting it. The Bureau of Property Management within DGS was given the initial responsibility to develop the guidelines, promulgate the rules, and seek statutory authority for such a program. The Bureau's current role is to work with agencies requesting this program. The agency certifies the need to the Bureau in addition to the fact that there is no available existing space present. The Bureau then determines agency needs and gives the agency the authority to solicit the bids for the turnkey project. Once the bids are then received, evaluated, and a recommendation for an award is forwarded by the agency to DGS, DGS reviews the supporting documents required by the provision of the Florida Administrative Code and either concurs or does not concur in the recommendation. If DGS concurs, the submitting agency is notified and is permitted to then secure the lease. Once the lease has been entered into; it is then sent back to DGS for review and approval as to the conditions; and thereafter the plans and specifications for the building are also referred to DGS for review and approval as to the quality and adequacy as well as code compliance. Section 255.249 and Section 255.25, Florida Statutes, set forth the requirements for soliciting and awarding bids for lease space in an amount in excess of 2,500 square feet. This provision requires that an award of this nature be made to the lowest and best bidder, and DCS utilizes that standard in evaluating and determining whether or not it will concur with an agency's recommendation. In the instant case, DHRS advertised for bids for the construction of office space in Palatka, Florida for its District III facilities. Before seeking to solicit bids, the District III staff conducted a search for other possible existing space within a five mile radius of the downtown area and located no adequate facilities. Thereafter, a Certification of Need was processed for a solicitation of proposals and approval was granted by DGS to follow through with the solicitation. A preproposal conference was advertised and held on October 14, 1983, and after project review by those present at the conference, bid opening date was set for November 22, 1983. Thirty-two bid packages were distributed and twelve bidders submitted proposals. The public bid opening was held as scheduled at 2:00 p.m., on November 22, 1983, in Palatka, Florida by Robert E. Litza, Facilities Services Coordinator for DHRS District III. Of the bids submitted by the twelve bidders, the lowest hid was rejected because of the failure of the bidder to comply with the requirements of the bid package. Of the remaining eleven bids, the four lowest were evaluated with the understanding that additional higher bids would be evaluated if the four lowest bids were found to be unacceptable. Among the four bids considered were bids of Chuck Bundschu, Inc., Kenneth R. McGurn, one of the Intervenors (McGurn submitted five prices scheduled for his bid and of these, only one was considered); Elizabethan, Petitioner herein; and TSU. Only three bids are pertinent to the discussion here. They are #8-C (McGurn); #11 (Elizabethan); and #12 (TSU). In pertinent particulars, these bids provided as to rental costs: 8-C 11 12 1st yr $14.00/$220,808 $8.95/$ 61,916.10 S 7.16/$ 49,532.88 2nd yr 14.00/ 220,8088 8.95/ 141,159.40 7.35/ 115,924.20 3rd yr 14.00/ 220,808 8.95/ 141,159.40 7.62/ 120,182.64 4th yr 14.00/ 220,808 8.95/ 141,159.40 8.08/ 127,437.76 5th yr 14.00/ 220,808 8.95/ 141,159.40 8.33/ 131,380.76 6th vr 14.00/ 220,808 8.95/ 141,159.40 8.59/ 135,481.48 7th yr 14.00/ 220,808 8.95/ 141,159.40 8.86/ 139,739.92 8th yr 14.00/ 220,808 8.95/ 141,159.40 9.19/ 144,944.68 9th yr 14.00/ 220,808 8.95/ 141,159.40 9.58/ 151,095.76 10th yr 14.00/ 220,808 8.95/ 141,159.40 10.09/ 159,139.48 Renewal Option 1st yr3.00/47,316 9.93/ 156,615.96 10.51/ 165,763.72 2nd yr3.00/47.316 9.93/ 156,615.96 10.99/ 173,334.28 3rd yr3.00/47.316 9.93/ 156,615.96 11.48/ 181,062.56 4th yr3.00/47.316 9.93/ 156,615.96 11.99/ 189,106.28 5th yr3.00/47.316 9.93/ 156,615.96 12.51/ 197,307.72 Total Basic Overall Lease 1-15 yrs $1,971,500 $2,115,430.50 $2,181,434.12 Average Sq.Ft. for 15 yrs $8.60 $9.20 $9.58 A recommendation by the evaluation committee which met at DHRS District III, that McGurn's bid be selected, was forwarded to DGS in Tallahassee through the Director of DHRS's General Services in Tallahassee on December 22, 1983. The terms of the successful bid and the reasons for its being considered lowest and best are discussed below. The successful bid for the lease in question, lease number 590:8030, upon completion of the committee's evaluation was also evaluated by Ms. Goodman in the Bureau of Property Management of DGS. She also considered the McGurn bid to be the lowest and best of the eleven non-disqualified bids. In that regard, not only Mr. McGurn's bid but all of the twelve bids received were considered and reviewed not only at the local level but at DHRS and DGS headquarters as well. In her evaluation of the proposal and the bids, Ms. Goodman considered the documentation submitted by DHRS. This included a letter of recommendation supported by a synopsis of all proposals, the advertisement for bids, and any information pertinent to the site selection process. In determining the McGurn's bid was the lowest as to cost of all the bids, Ms. Goodman compared the average rate per square foot per year for each. This did not take into con- sideration pro-ration of costs per year, but strictly the average over the fifteen year probable term of the lease (ten years basic plus five year option). According to Ms. Goodman, this same method of calculating cost has been used in every lease involving a turnkey situation and in fact in every lease since 1958 - as long as she has been with DGS. This particular method, admittedly, is not set forth in any rule promulgated by DGS. However, the agencies are instructed by DGS to advertise and bidders to bid on an average square foot basis, the basis utilized by Ms. Goodman and her staff in analyzing the bids submitted. In that regard, the request for proposals does not, itself, indicate how the calculation of lowest cost would be made by DHRS and DGS but it does tell prospective bidders what information to submit. This procedure has been followed exclusively in situations like this for may years and many of the bidders here have bid before using this same system. All bidders are considered on the same footing in an evaluation. They are notified of what information will be considered along with that of all the other bidders. Further, anyone who inquires as to the basis for evaluation will be given a straight and complete answer as to the method to be used. Petitioner contends that McGurn's bid does not conform to either the normal bidding procedure followed by contractors in this type of procurement over the past years or to the normal bidding procedures adopted by Respondent, DHRS. It urges that the questioned bid is non-responsive and front-end loaded to the detriment of DHRS. With regard to the front-end loading objection, Mr. Taylor, testifying for Petitioner, attempted to indicate by graphic evidence that Elizabethan's bid, which he claims is not front-end loaded, is cheaper to the State than that of McGurn. Due to the large rental cost of the McGurn bid in the opening years of the lease, the State would have to borrow money to make the large rental payments; the interest cost of which, when added to the $3.00 cost in the option years, raises the cost considerably and makes the bid not the lowest. Though Mr. Taylor testified to this he failed to produce any independent evidence to support it. In addition, Taylor urges, under the McGurn schedule, McGurn would recoup his entire construction debt (approximately $423.00 plus interest) in the first four years of the lease: Comparing the two bids, it appears that the State would pay McGurn approximately $494,500.00 more than it would pay Elizabethan for the same period during the first seven years of the lease. Considering this, it is Taylor's belief that McGurn's profit after the fourth year is excessive. He contends also that when, after the tenth year, McGurn's rental rate drops to $3.00 per square foot for the remaining five years which constitutes the option period of the lease, the State could not afford to leave the low figure and as a result, the ten year lease is converted to a l5 year lease which is unresponsive. Further, the $3.00 figure for the last years, which would ostensibly show a loss to McGurn, is misleading in that there would be sufficient income from the advance profit garnered in years 5 to 10, when invested, to cover the soft costs and more in these later years. Admitting that because of its involvement in other turnkey projects in Florida, Elizabethan is aware of the State policy on cost evaluation, Taylor contends that while his bid does not violate State policy, McGurn's bid does because it would be fiscally irresponsible for the State to pay so much up front. This conclusion is his opinion, however, and not supported by any independent evidence. Both expert witnesses, Respondents Scott and Perry, who testified for the Intervenor, TSU, agree that the present value of money should be considered in evaluating rental costs. Their major point of difference is in the percentage of discount rate to be applied. Dr. Perry urges that use of the 10% rate mandated by the U. S. Government in its procurements of this nature. Dr. Scott, on the other hand, considers this to be too high and urges a rate in the area of 3% be used. The significance of this is that at the lower of the range spread, McGurn's bid is lowest. At the higher end, TSU's bid is lowest. From 5.7% up to below 6%, Petitioner's bid is lowest. Whichever would be appropriate, the State has not adopted the present value of money methodology and the policy followed by the State is not to consider that methodology in analyzing costs. State policy is to use only the average rental methodology. There is, in addition, no prohibition against front- end loaded bids encompassed within this policy. By the same token, there is nothing in the bid package issued to all prospective bidders that in any way stipulates the method of computing lease costs or prohibits from loaded bids. DGS zone rates, criteria stipulating the maximum agencies can send on rent without approval by DGS, are not part of the bid package and do not constitute a factor in determining whether a bid is conforming or not. These zone rates may be waived by DGS at the time the proposed award is submitted for DGS approval. In practice, within the memory of Joseph Lambert, HRS' Administrator of Facilities Services, who administers the Department's leasing program, he cannot recall DGS ever denying a DHRS request for waiver of the maximum zone rate in any case where it was pertinent. In this case, since the lease payments at-least in the second through tenth years-of the McGurn bid exceed the zone limits, the award would have to be approved by the Governor and Cabinet in addition to DGS. It has not yet been placed on the Cabinet agenda because of the protests filed. As was stated before, there are no rules governing the evaluation of bids for leases of this nature. Oral instructions given to each agency, when applied here, reveal that the McGurn bid, as was seen above, has an average cost of $8.86 per square foot per year. TSU's bid costs $9.58 per square foot per year, and Elizabethan's bid costs $9.29 per square foot per year. These same calculations are followed on all turnkey and non- turnkey leases in the State. The reason the State uses this process instead of the present value of money methodology is that it is easy. DGS statistics indicate that at least 50% of the landlords in the approximately $32,000,000 worth of leases presently existing with the State are "Mom and Pop" landlords. These people are not normally trained lease evaluators. By using the straight average rental rate method, there are no arbitrary variables. It has always worked because people can understand it and all agencies which lease property in the State follow this procedure. In the opinion of Ms. Goodman, the costs involved in utilizing the present value of money methodology would far outweigh the paper savings to be gained, notwithstanding the testimony of Dr. Perry to the contrary. With regard to the option issue, it was the position of DGS in reviewing the proposals that the very low $3.00 lease cost per square foot in the last five years (the option period) did not make the McGurn bid unresponsive. There were no limits imposed upon the bidders except that a five year option to a ten year lease be included. Were it not there, the bid would be unresponsive. DGS would issue approval for a ten year lease with a five year option but not a fifteen year lease. Ms. Goodman cannot recall a situation in which an option was not exercised by it if the need for the space continued though there have been some instances where option costs have been renegotiated.
Recommendation Based on the foregoing, it is, therefore; RECOMMENDED THAT DHRS License Number 590:8030 be awarded to Kenneth R. McGurn. RECOMMENDED this 5th day of September, 1984, in Tallahassee, Leon County, Florida. ARNOLD H. POLLOCK Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkwav Tallahassee, Florida 32301 Filed with the Clerk of the Division of Administrative Hearings this 5th day of September, 1984. COPIES FURNISHED: David Pingree, Secretary Department of Health and Rehabilitative Services 1323 Winewood 8Oulevard Tallahassee, Florida 32301 Morgan Staines, Esquire 2204 East Fourth Street Santa Ana, California 92705 Thomas D. Watry, Esquire 1200 Carnegie Building 133 Carnegie Way Atlanta, Georgia 30303 Steven W. Huss, Esquire Department of Health and Rehabilitative Services 1317 Winewood boulevard Tallahassee, Florida 32301 Ronald W. Thomas, Executive Director Department of General Services 115 Larson Building Tallahassee, Florida 32301 Steven W. Huss Assistant General Counsel Department of Health and Rehabilitative Services 1317 Winewood Blvd. Tallahassee, Florida 32301 Gary J. Anton, Esquire P.O. Box 1019 Tallahassee, Florida 32302 Harden King, Agency Clerk Assistant General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Building One, Suite 406 Tallahassee, Florida 32301
The Issue The issue to be resolved concerns whether the Petitioner was the victim of a discriminatory housing practice, by allegedly being denied the opportunity to rent an apartment from the Respondents, and by being falsely informed of its non- availability, based upon her race.
Findings Of Fact The Petitioner is an African-American female. In early January 2007, she learned of an apartment for rent, owned or managed by the Respondents. She called to inquire about the apartment and was told by the Respondent, Ms. Lindsay, that the rent would be $625.00 per month, with a one-month rent amount and security deposit due in advance. She was told that the Lessee of a neighboring apartment, Clint Cook, would have a key and would show her the apartment. She went to view the apartment, and decided that she wished to rent it. She then telephoned Ms. Lindsay, and Ms. Lindsey faxed an application to her to complete. In the conversation, she told Ms. Lindsay she would not have the required deposit money until Friday. This was on a Monday or Tuesday. Ms. Lindsay then told her securing the apartment was on a “first come-first-served” basis. The Petitioner never completed the application and never tendered the security deposit. Shortly after that telephone conversation, Ms. Lindsay was contacted by Stacey Edwards, while the apartment was still available for rent, concerning rental. Ms. Edwards, on behalf of herself and her boyfriend/husband, submitted an application to rent the apartment, together with the appropriate required deposit and rental amount on January 15, 2007. Ms. Lindsay leased the apartment to the couple. They had a planned move-in date of February 1, 2007. They are a mixed-race couple, and Ms. Lindsay was aware of that fact when renting to them. Sometime after January 15, 2007, the Petitioner called Ms. Lindsay a second time, and was told that the apartment had been rented (to the Edwards couple) and was no longer available. Testimony to this effect is corroborated by the Edwards rental application and deposit receipt, which are in evidence. The Edwards rental was documented on January 15, 2007. Later that month, the Petitioner noticed the “for rent" sign displayed, or displayed again, and she and/or her witness, Lynn Kliesch, called about the apartment’s availability. Ms. Lindsay again stated that it was rented. Indeed, it was, to the Edwards. The rental sign had been left up because the Edwards couple were not scheduled to move in until February 1, 2007. This communication between the parties occurred before Ms. Edwards informed Ms. Lindsay that they would not be moving in. Shortly before February 1,2007. Ms Edwards and her husband/boyfriend learned that his employment had ended (or he was transferred to another job location). They therefore informed Ms. Lindsay that they had to re-locate to South Florida and could not take the apartment. She charged them for the two weeks of rental, and refunded their deposit. She then placed the apartment back on the rental market. On January 31, 2007, Ms. Mari Ferguson inquired of Ms. Lindsay about the apartment’s availability. This was after Ms. Edwards had informed Ms. Lindsay that she would not be renting the apartment. Ms. Lindsay told Ms. Ferguson that the property was available and she rented it to Ms. Ferguson that same day. Ms. Ferguson and her boyfriend, who occupied the apartment with her, were also a mixed-race couple, with children. In fact, the boyfriend is the nephew of the Petitioner herein. Ms. Ferguson and family moved into the apartment. Some months later a hostile situation arose between the Respondents and Ms. Ferguson. Ms. Lindsay apparently received reports that “drug dealing” was occurring in the apartment. Ms. Ferguson and/or the other occupants were responsible for some damage, and Ms. Ferguson became several months behind on rental payments. The Respondents therefore, through legal process, had her evicted. The Respondent, Ms. Lindsay, through her firm, Elite Properties of Northwest Florida, Inc., manages some 37 rental properties in Escambia and Santa Rosa Counties. She is the president and broker for the firm and has no employees or agents. Among the rental property owners she and her firm represent is her Co-Respondent, Michael Houser. Both Ms. Lindsay and Elite Properties, as well as Mr. Houser, have a significant number of minority tenants, both Hispanic and African-American. A substantial number of those, both historically, and at the time of the hearing are single, African-American females, as heads of households. There is no evidence, aside from the Petitioner’s unsubstantiated opinion, that either the Respondent has ever refused to rent to the Petitioner or anyone else, based upon race, nor that they have falsely denied availability of a dwelling for rent or sale for that reason. There is no evidence that they have refused or attempted to avoid holding out a property for rent or sale for reasons based on racial animus.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore, RECOMMENDED that a final order be entered by the Florida Commission on Human Relations, determining that the Respondents did not commit a discriminatory housing practice based upon the Petitioner's race and that the Petition be dismissed in its entirety. DONE AND ENTERED this 16th day of April, 2009, in Tallahassee, Leon County, Florida. S P. MICHAEL RUFF 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 16th day of April, 2009. COPIES FURNISHED: Sylvia Mims 3382 Greenbriar Circle, Apt. B Gulf Breeze, Florida 32561 Beverly Lindsay 5252 Springdale Drive Milton, Florida 32570 Michael Houser 3533 Edinburgh Drive Pace, Florida 32571 Larry Kranert, General Counsel Florida Commission on Human Relations 2009 Apalachee Parkway, Suite 100 Tallahassee, Florida 32301 Denise Crawford, Agency Clerk Florida Commission on Human Relations 2009 Apalachee Parkway, Suite 100 Tallahassee, Florida 32301
Findings Of Fact The Respondent, Bertram Gould, is president and stockholder of Mohican Valley, Inc., d/b/a Indian Woods Subdivision. The Indian Woods Subdivision is located in Seminole County and consists of in excess of 150 subdivided lots. On May 20, 1982, Mohican Valley, Inc. purchased a mobile home park located in Seminole County, Florida, from Winter Springs Mobile Home Corporation. The park was formerly known as Mohawk Village, but is now known as the Indian Woods Subdivision. Bertram Gould and Mohican Valley, Inc. acquired their interest in the subdivision by virtue of a purchase and sale agreement, deed and assignment of lease indentures from Winter Springs Mobile Home Corporation. Individuals desiring to live in the mobile home park purchase their mobile home and contemporaneously sign a 99-year lease on the lots upon which the mobile homes are to be placed. The mobile homes purchased by prospective residents in the subdivision are typically purchased from Vaughn Motors, Inc., a corporation of which Mr. Gould is president. In 1981, Vaughn Motors, Inc. sold a mobile home to Alfred and Beverly Powers, which arrived at the park and was setup on November 30, 1981, or shortly thereafter. On March 1, 1982, Vaughn Motors, Inc. sold that mobile home to Warren E. and Sylvia Joyce Krummel, since the Powers had elected not to close the purchase. On the date of the sale to the Krummels, the mobile home was already setup on Lot 1, Block E, of the subdivision and ready for occupancy. On June 14, 1982, after the May 20 purchase of the subdivision by Mohican Valley, Inc, through its president, Bertram Gould, the Krummels executed an Indenture of Lease for Lot 1, Block E. There was thus a residential building on that property subject to the lease at the time the lease was entered into. On June 5, 1982, Dorothy Merritt signed a purchase agreement to buy a mobile home and the mobile home was delivered and setup on her lot on August 6, 1982. On that date she also signed a lease for the lot where the mobile home was placed. Thus, when the interest in that property was conveyed by lease, there was a residential building on the lot. Roy and Lydia Ardizzone initially leased a lot in the park from Winter Springs Mobile Home Corporation before the sale to Mohican Valley, Inc. and Bertram Gould. In August, 1982, after Mohican Valley, Inc. purchased the subdivision, the Ardizzones decided to place a mobile home on their lot, but since the Phase II portion of the subdivision in which their original lot was located was not completely developed, it was not feasible to place the home on the lot at that time. Accordingly, they asked Mr. Gould to substitute their lot for a lot in Phase I in order to facilitate placing a home on the lot and begin living in the park. Mr. Gould agreed and the substitution occurred on August 31, 1982, on which date the Ardizzones also signed a lease for the lot. They ordered a mobile home to be placed on that lot, which arrived some 10 days later, on September 9, 1982. It was immediately setup on the Ardizzone's lot. Thus, at the time the lease of August 31, 1982, was executed by the Ardizzones and Bertram Gould, the Ardizzones had already ordered the mobile home for immediate delivery, which was delivered and setup some 10 days later. Thus, there was an obligation on the part of the Respondent to provide a mobile home to them in less than two years and indeed within days. On or about September 4, 1982, Bertram Gould caused a mobile home to be placed on Lot 3, Block B of the subdivision and had it prepared for occupancy. On November 5, 1982, George W. and Alice H. Woodward signed a purchase agreement for the mobile home and ultimately executed a lease for the lot upon which that mobile home sat on January 10, 1983. They moved into their home on or about February 17, 1983. Thus, at the time the lease was executed by the Woodwards and Respondent, a residential building was present on the property subject to the lease. Mohican Valley, Inc.'s predecessor in title, Winter Springs Mobile Home Corporation, had, during the course of its development of the mobile home park, entered into approximately 156 ground leases for mobile home lots. In conjunction with the acquisition of title to the park by Mohican Valley, Inc., Mohican Valley Inc. was assigned all rights of Winter Springs Mobile Home Corporation in those 156 leases which had already been recorded by Winter Springs Mobile Home Corporation prior to the acceptance of assignment by Mohican Valley, Inc. It was not established that Mohican Valley, Inc. or Bertram Gould had participated in any offer or disposition of the property which was the subject of those leases prior to Mohican Valley, Inc.'s acceptance of their assignment. Prior to May 20, 1982, the Respondent had no ownership interest in either the mobile home park or in Winter Springs Mobile Home Corporation, which owned and managed the Park. He was not an officer, director, employee, salesman or any type of agent for the owner of the mobile home subdivision prior to May 20, 1982. The only nexus between the Respondent and the mobile home park prior to May 20, 1982, was his position as president of Vaughn Motors, Inc. which had sold mobile homes to some of the residents of the park who had executed leases which ultimately became assigned to Mohican Valley, Inc. The Respondent caused certain advertisements to be placed in the Orlando Sentinel newspaper. Although an advertisement was placed April 25, 1982, the Respondent was not involved in the publishing of that advertisement. It appeared in the newspaper approximately a month prior to purchase of the park by Mr. Gould's company. On June 4 and 5, 1982; September 19, 1982; October 10, 1982; and January 29, 1983, the Respondent admittedly placed advertisements in the Orlando Sentinel representing amounts of monthly lot rent, terms of available bank financing, the office address, the phone number and hours of operation, as well as representing the fact that mobile homes could be purchased at the park for a listed price, including certain optional features, as well as the representation that the mobile home park then owned by Mohican Valley, Inc. offered quarter-acre lots and double-wide homes with certain amenities. The price for lot rent was represented as never increasing. Bank financing was advertised as available variously at 14 and a quarter percent interest and 13 and a half percent interest. The representations contained in those advertisements were true, however, at the time Mohican Valley, Inc. took title to the mobile home park, a foreclosure action and lis pendens had been filed on that property by Florida Land Company, the mortgagee on a mortgage executed by Winter Springs Mobile Home Corporation, Mohican Valley, Inc.'s predecessor in title. That foreclosure had been filed on or before March 21, 1983, as evidenced by the Motion to Intervene (in evidence as Petitioner's Exhibit 4), which was filed in that foreclosure proceeding by Mohican Valley, Inc. No representation was made in these advertisements concerning the fact that the property which was the subject of the mobile home lot leases offered by Respondent was the subject of a mortgage encumbrance which was then in foreclosure, which foreclosure predated those advertisements. Bertram Gould, as president of Mohican Valley, Inc., as the movant in that Motion to Intervene, and as the successor in title to the mortgagor-in-foreclosure, knew of the existence of the facts surrounding that foreclosure as they related to the interest in the land he sought to convey and the effects such a foreclosure might have on the persons or residents of the park who executed those leases as lessee thereafter. Bertram Gould thus materially participated in the offer or disposition of the lots for lease in the subdivision and advertised those dispositions or offerings without representing that the real property to which they related was the subject of a pending foreclosure action. No reservation program has been approved by Petitioner for Bertram Gould, Mohican Valley, Inc. and/or Indian Woods, nor has any application for such been filed. No public offering statement for Bertram Gould, Mohican Valley, Inc. or Indian Woods, nor any application for such has, as of the time of the hearing, been filed and approved. The Indian Woods Subdivision has not been registered with the Petitioner by either Bertram Gould or Mohican Valley, Inc. Bertram Gould has engaged in the disposition of these subdivided lands directly as well as on behalf of Mohican Valley, Inc., of which corporation he is president and stockholder. Bertram Gould has offered, disposed of or participated in the offer or disposition of interests in the subdivided lands involved herein, which are located in Florida, by offering the subject land for leases to prospective mobile home purchasers and park residents.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence in the record and the candor and demeanor of the witnesses, it is, therefore RECOMMENDED: That Bertram Gould be found guilty of violations of Sections 498.023(1) and (2), and Section 498.049(4) and Sections 498.051(1)(a), (b), and (d); that a penalty of $2,000 be imposed and that the Respondent be ordered to cease and desist the above described activities until the requirements delineated above involving registration of the subject subdivision, approval and promulgation of a current offering statement have been accomplished. DONE and ENTERED this 31st day of January, 1984, in Tallahassee, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 FILED with the Clerk of the Division of Administrative Hearings this 31st day of January, 1984. COPIES FURNISHED: Harold F. X. Purnell, Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Ladd H. Fassett, Esquire Post Office Box 2747 Orlando, Florida 32802 E. James Kearney, Director Division of Florida Land Sales and Condominiums Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Gary R. Rutledge, Secretary Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
The Issue Whether the Department of Transportation's intended action to reject all quotes and re-advertise Lease No. 550:0318 was illegal, arbitrary, fraudulent, or dishonest.
Findings Of Fact In October of 1999, the Department advertised for office space for use as the Toll Data Center - Audit Section, Office of Toll Operations (Toll Office) located in Broward County. The lease was clearly advertised as a negotiated lease. It was not advertised as a competitive bid lease. Under the negotiated lease process before letting any lease, the Department must submit to the Department of Management Services (DMS) a Request for Space Need (RSN) and Letter of Agency Staffing (LAS). From DMS the Department receives the authority to directly negotiate a lease for space under 5,000 square feet with prospective lessors. 1/ Consistent with procedure, the Department received approval of the RSN on October 18, 1999. Pursuant to statute, DMS has strongly suggested that prior to selection of the apparent successful lessor, the Department should obtain a minimum of three documented quotes for a lease that has not been competitively bid. The Department has consistently followed that suggestion in negotiated leases. Under special circumstances, where it is clear it is improbable that three quotes cannot be obtained, the Department may waive its requirement that three documented quotes be received. However, the agency must certify to DMS that attempts to receive the required number of documented quotes were unsuccessful and/or special circumstances exist to negotiate the lease with less than three quotes. In this case, no special circumstances exist. In an effort to obtain more than the minimum three documented quotes, the Department opted to advertise for lease space on the Internet. The Internet is utilized by the DMS, among other state agencies, to disseminate information provided in the RSN to the private sector. Additionally, the Internet site may also be used by the private sector to provide notice of space they have available for review by the agency seeking space. A total of three submittal packages were distributed for Lease No. 550:0318. Despite the Department's advertisement over the Internet, only two requests for quote submittal packages were received. Of the three quote submittal packages distributed, the Department received only one documented quote in response to the advertisement for the Toll Office. Atlantic Investment submitted a Quote Submittal Form to the Department in late October for office space in North Fort Lauderdale. Atlantic Investment became aware of the Department's advertisement for lease space from Sheldon M. Schermer, employed by Atlantic Investment as its real estate agent. Mr. Schermer learned of the Department's need for lease space from an advertisement placed on the Internet. On November 8, 1999, the Department informed Atlantic Investment via Sheldon M. Schermer, Real Estate Agent for Atlantic Investment, of the Department's intent to reject all quotes and re-advertise for Lease No. 550:0318. This decision was not arbitrary, capricious, fraudulent, or dishonest and well within the Department's discretion and procedures for negotiated leases. The basis for the decision was the Department's modification of the lease specifications pursuant to a recommendation by DMS to modify the lease space terms to hopefully generate more interest and more quotes. In a competitive negotiation, DMS was aware of agencies who modified leases and advertised as many as five times before three documented quotes were received. Moreover, the evidence showed that the Broward County commercial real estate market could easily generate three quotes for the space required by the Toll Office.
Recommendation Based upon the findings of fact and conclusions of law, it is RECOMMENDED: That a final order be entered dismissing the Petitioner's protest. DONE AND ENTERED this 14th day of April, 2000, in Tallahassee, Leon County, Florida. DIANE CLEAVINGER 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 14th day of April, 2000.
Findings Of Fact In June, 1975 Randall J. Conley, attempting to set his son and daughter-in-law up in business, arranged for them, with his help, to purchase Roger Sparks' business known as Sparky's Pizza. By Exhibit 6 dated June 17, 1975 the owner and lessor of the premises executed, with Randall M. Conley and his wife Sandra, a Consent to Assignment whereby the lease between the lessor and Mr. Spaghetti and Roger Sparks was assigned to the younger Conley and his wife and the previous lessees were released from further liability under the five year lease they had executed on April 30, 1974. (Exhibit 10) By Collateral Assignment Note dated 6-2-75 Randall J. Conley, Randall M. Conley and Sandra Conley obligated themselves to pay the Florida Center Bank $9750 over a five-year period and pledged the equipment and fixtures in the pizza business as security therefor. In October, 1975 Sandra, who had been operating the business, left for another job preparatory to separating from her husband. The business closed on November 1, 1975 and Defendant learned that the lessees were delinquent in the rent and payments on the chattel mortgage. Thereafter he attempted to sell the business. In November, 1975 Charles Hicks, the owner of a small fast-food chain, while looking for a site for a franchisee, saw the empty Sparky's Pizza and ascertained that information on occupying the property could be obtained from Defendant. He called Defendant's office and was told the rent was $260 per month. Arrangements were made for Defendant to show him the property the same afternoon. On November 25, 1975 Defendant showed Hicks and his putative franchisee, Ronald Beasley, the property. After being assured that the rental included the equipment and fixtures they agreed to accept an assignment of the lease if the lessor agreed and to bind the transaction Hicks gave Defendant a check for $200 made payable, at the request of Defendant, to Randall J. Conley. No written agreement was executed by the parties at this time. The check stated on its face that it was a deposit on lease of building here involved. The following day Defendant called Hicks and told him that the lessor had agreed with the assignment and that he should bring a check for $7,000 to pay for the equipment, plus a check for the rent. Hicks objected to the purchase of the equipment and demanded return of his $200 deposit. Defendant refused to return the money and Hicks immediately tried to stop payment on the check. When he did so he learned that his check had been cashed by Defendant as soon as the bank opened that morning, November 26. After Hicks was unsuccessful in getting his deposit returned he reported the incident to the FREC and the complaint here under consideration was filed. Defendant contends that he was operating as the owner of the lease and not in his capacity as a broker; that the consent to assignment of the lease did not result in an assignment; that by executing the collateral installment note he was part owner of the business; that when his daughter-in-law left and the business folded he acquired the leasehold by abandonment; and that he was entitled to retain Hicks' deposit of $200 as liquidated damages. One witness called by Defendant testified that the bank's policy on chattel mortgage loans was that they would only make such loans to the owners of the business. However, he acknowledged that he did not handle the loan here involved and never saw any documents showing Randall J. Conley having an interest in the leased premises, the equipment and fixtures for which was the subject of the loan represented by Exhibit 9. Defendant had advertised the sale of the lease in the newspaper and therein indicated the assignee of the lease would be required to assume payments on the equipment. Neither Hicks nor Beasley ever saw any such advertisement.
Findings Of Fact Based upon my observations of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, the following relevant facts are found. By its one-count Administrative Complaint filed herein on April 3, 1980, the Petitioner, Department of Professional Regulation, Board of Real Estate, alleged that the Respondent, William O'Brien, violated Section 475.25(1)(d), Florida Statutes (1979), due to his failure to deliver a security deposit to a property owner and that Respondent thereafter tendered a protion of the deposit in the form of a check which, when presented for payment, was not honored due to insufficient funds. During times material, Respondent was licensed by Petitioner and is the holder of Florida Real Estate License No. 168869. Gary ;Heide is the owner of the duplex apartment situated at 2407 Northeast 33rd avenue, Fort Lauderdale, Florida. The pertinent facts surrounding the allegations herein are, for the most part, simple and undisputed. The subject premises had been leased by owner Heide to Maurice L. LaReau. LaReau had leased the premises for approximately eleven (11) months when he found a residence that he intended to purchase and was therefore desirous of subletting the subject property with the owner's permission in an acceptable manner such that he would not incur any losses due to his vacating the premises prior to the expiration of the lease term. He, therefore, approached owner Heide and advised him of his intentions. According to LaReau, Heide gave him "carte blanche" authority to find a tenant to sublease the apartment but that he would appreciate it if he would "screen" the sub-lessee. Heide suggested that LaReau place an ad in the newspaper to secure a tenant and he also made known to LaReau his overall objective of not sustaining any loss of rents due to a vacancy in the apartment. During that conversation Heide also advised LaReau that he would be leaving for a vacation in Germany shortly. When LaReau leased the subject premises from Heide he entered a twelve (12) month lease and paid a $900.00 fee which included the first and last month's rent plus a security deposit. During times material, Respondent was the registered corporate broker for Exclusively Rentals and Management Company (Exclusively). Through the efforts of Respondent and Exclusively, Gregory A. Costa, III, was secured as a tenant to sublet the subject property from Maurice LaReau on or about October 8, 1977. Respondent had been approached by owner Heide to manage the subject property while Respondent was visiting an apartment complex adjacent to the Heide property on which Exclusively had the managing contract. According to the agreed terms for the subletting of the Heide property from LaReau to Costa, Costa agreed upon an occupancy date of October 15, 1977, for a total rental of $150.00 plus payment for the twelfth month rent for a fee of $300.00; a security deposit of $300.00 and a $150.00 commission to Exclusively for a total of $900.00. This amount was paid to tenant Maurice LaRaeau. Exclusively retained the agreed upon commission which represented on- half the monthly rental, or a fee of $150.00 See Respondent's Exhibit 1. Additionally, Messer. LaReau signed an agreement representing that the subletting was done with owner Heide's knowledge and was in accordance with his instructions. (Respondent's Exhibit 2). Upon returning from Germany, owner Heide became upset that LaReau had sublet the premises to Costa and contended that the subletting was only to have been done through the aid and assistance of another rental management firm know as Home Finders Real Estate Brokers. Heide contended that Audrey Lester was the only agent connected with that firm who had the authority to accept tenants or sub-lessees in his absence. Heide, therefore, contended that he was entitled to recoup from Respondent, through its corporate entity, Exclusively Rentals and Management Company, the entire $900.00 in addition to a continued retention of the $900.00 deposit which had been paid by the tenant, LaReau. Although Heide contended that he never used Exclusively to rent or otherwise secure tenants for any of his apartments, he acknowledged that he signed a new lease and accepted Costa as a tenant for the subject property. Heide's other complaint with Respondent is that a check dated November 10, 1977, in the amount of $150.00 and signed by Michael J. Cochran was not honored when presented for payment due to insufficient funds. An examination of that check does not reveal that it was returned by the bank upon which it was drawn or that it was even presented for payment as testified to by Messer. Heide (see Petitioner's Exhibit D). Respondent was approached by owner Heide to act as an agent to secure tenants for his property as vacancies occurred while Respondent was visiting an adjoining rental property through which Respondent's agency represented, the Ocean Gardens Apartment building. Heide also visited Respondent's office building prior to the subject incident (TR. 37 of the June 3, 1981, hearing). Respondent did not sustain any loss of rents due to the subletting of the subject property from LaReau to Costa through the efforts of Respondent and/or Exclusively Rentals and Management. Respondent credibly testified that there were ample monies in the account of Exclusively to pay the $150.00 check drawn by that firm to owner Heide in November of 1977, had it, in fact, been presented for payment. Respondent severed his relations with Exclusively and advised all of the associates of that severance during December of 1977. 2/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is hereby, RECOMMENDED: 1. That the Administrative Complaint filed herein be DISMISSED. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 23rd day of July, 1981. JAMES E. BRADWELL Hearing Officer Division of Administrative Hearings The Oakland Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of July, 1981.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: The petitioner is a dentist and is also engaged in the business of leasing real property in Florida for commercial purposes. A tax auditor for the respondent, Mr. Eugene A. Soinski, notified petitioner that an audit of his books and records would be conducted to determine whether petitioner was remitting the appropriate amount of rental taxes to the respondent. At the time of the initial audit, Mr. Soinski was supplied with only bank deposit receipts and certain leases. The auditor had difficulty in determining which were mortgage payments and which were rental payments. Based upon the auditor's review of petitioner's deposit slips, lease agreements, a three-year audit prepared by petitioner and discussions with some of petitioner's tenants, as assessment for delinquent taxes was made. The initial assessment was reduced and the present dispute lies with the revised assessment dated October 2, 1978, in the amount of $5,316.35. In his amended petition for a hearing and at the hearing, petitioner alleged that no rent tax was due on three specific leases. Petitioner offered no evidence to refute the respondent's assessment on any other lease. All testimony and evidence adduced at the hearing was confined to the lease agreements between petitioner and three other businesses -- Suncoast Amusement, Product Movement Systems, Inc., and Staid, Inc. One of the three disputed items in the assessment concerned an agreement between petitioner and Suncoast Amusement, also referred to as Hot Foots. The lease agreement between Suncoast and petitioner was not made available at the hearing. According to the testimony of the petitioner, the tenant removed carpeting from the premises and installed new red carpeting in its stead. Certain other improvements were also made to the property. The petitioner testified that he received no actual benefit to the property from these improvements, and that the red carpet actually decreased the value of the property. The auditor, Mr. Soinski, remembered seeing the lease agreement and matching the rental payment amounts with the deposit receipts to arrive at the assessment. A copy of the first two pages of the "business lease" between petitioner and Product Movement Systems, Inc., was received into evidence as respondent's Exhibit 3. This agreement contains the stipulation that TWENTY-SECOND: Minimum of two room office, with air, will be built at tenant's expense and remain as part of the first years rent. According to petitioner, the tenant actually built eight to ten offices and this did not improve the real estate. It was, instead, a deterrent to future tenants, according to petitioner. A copy of the "business lease" between petitioner and Staid, Inc., was received into evidence as the respondent's Exhibit 2. The consideration for the agreement was a total rental of sixty thousand dollars, payable as follows: One thousand dollars per month in advance, plus 4 percent State tax. Two thousand dollars security deposit, receipt acknowledged. Also on the first of each month an amount equal to 1/60th of the total cost of all improvements of any kind, as approved by both parties, will be paid plus the above basic rent of $1,040. - per month. Also, the twenty-fourth stipulation and condition in said lease provides as follows . . . TWENTY-FOURTH: If during the life of this lease tenant has need of more space every effort will be made to provide some adjacent. If it is desirable to both parties a new building is necessary then such buildings will be to tenants specifications, the rent will be the total cost of such land and improvements including architect fee, cost of mortgage, paving, landscaping or any expense of any nature x 15 percent net, net. According to the petitioner, he made a loan to Staid, Inc., in the amount of $48,000.00 to enable Staid to pay for certain improvements to the property. This loan was to be repaid in installments of $800.00 per month for sixty months. It was petitioner's testimony that regardless of the wording contained in the lease agreement, the improvements were not considered a part of the rent, he derived no benefits from the improvements to the property, and part of the payment made by the tenant each month was for repayments of a loan, rather than rental on the property. It was the testimony of Mr. Soinski, the auditor, that the assessment of the three disputed leases was based on the total amount of rent paid by the tenants to the petitioner, which rent included any improvements to the property. Where lease documents were available, he utilized the amount of rent due from the face of the lease document. Where possible, he compared the lease documents with the petitioner's bank deposit slips. The revised notice of proposed assessment dated October 2, 1978, was received into evidence as the respondent's Exhibit 1. This document assesses a tax on rentals of real property in the amount of $4,215.40, a delinquent penalty in the amount of $210.79 and interest through October 2, 1978, in the amount of $890.16, for a total amount of $5,316.35.
Recommendation Based upon the findings of fact and conclusions of law recited above, it is RECOMMENDED that the proposed assessment dated October 2, 1978, in the amount of $5,316.35 be upheld and that the relief requested by petitioner be denied. DONE AND ENTERED this 3rd day of January 1980 in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of January 1980. COPIES FURNISHED: James W. Hickman 203 River Bend Longwood, Florida Linda Procta Assistant Attorney General Department of Legal Affairs The Capitol LL04 Tallahassee, Florida 32301 =================================================================
The Issue Whether or not the actions of the petitioner in amending its lease agreement resulted in increased costs which are reimbursable by the Department of Health and Rehabilitative Services through an interim rate request.
Findings Of Fact Hallandale is a licensed nursing home facility located in Hallandale, Florida, and at all times material hereto, Hallandale was certified to and was participating in the Florida Medicaid Program. The participation was subject to a standard nursing home provider agreement entered into by the parties. Pursuant to the agreement, Hallandale provides nursing care for Medicaid recipients and receives as payment the recognized rate of Medicaid reimbursement established for Hallandale by HRS in accordance with the applicable state and federal laws, regulations, and guidelines. The agreement may be cancelled by either party after giving thirty (30) days notice. In 1971, Hallandale entered into a lease agreement with the owners of the nursing home facility and began operating the nursing home. The lease called for a payment of $84.00 per month, per bed, had no escalation clause, and would not expire until 1986. At the time the lease was negotiated, the owners had been operating the nursing home themselves at a loss. To avoid bankruptcy or having to sell the property at a loss, the owners leased the property to Hallandale. However, within seven or eight years the owners began to put pressure on Hallandale to renegotiate the lease because the owners did not think they were getting a fair return on their investment. In 1981, the owners and Hallandale entered into negotiations to amend the terms of the lease to provide an increased rental rate and an extension of the lease term. The negotiations were not successful, and finally, by letter dated July 6, 1983, the owners issued the following ultimatum: "Although the lease has a renegotiation clause six months prior to expiration, we must renegotiate the terms and conditions of this lease immediately. The partnership has made a decision that we will definitely not renew or extend your lease unless we can come to some satisfactory arrangement regarding terms and conditions, effective immediately." On December 13, 1983, Hallandale and the owners entered into an amendment to the original lease. The amendment increased the lease payments and extended the lease until August of 1998. The amended lease provided for a minimum rental of $110 per month, per bed, as of September 1, 1983, with increases in the rental every year thereafter. Saul Lerner has been president of Hallandale since 1975 and has been associated with the facility since it was first leased in 1971. Mr. Lerner is an astute businessman who has been involved in a variety of businesses for forty years. He was chiefly responsible for renegotiating the lease with the owners. Although the lease was renegotiated due to the owners' threats to sell the facility, 1/ Mr. Lerner did not merely accede to the owners' demands. There were several offers and counteroffers made before the final agreement was reached, and the renegotiated lease provided for a considerably lower rental rate than that demanded by the owners. Prior to entering into the lease amendment Mr. Lerner consulted with people in the industry, had a MAI appraisal performed, discussed the situation with James Beymer, a real estate broker specializing in nursing home and health related facilities, consulted with his accountants who had been in the health care field for 13 years, and talked with Sebastian Gomez of the Department of Health and Rehabilitative Services. Mr. Lerner consulted with his business associates, and the pros and cons of renegotiating the lease were carefully considered. Hallandale's determination to renegotiate the lease in 1983 was a reasonable and prudent business decision. By agreeing to increased rental payments for the three years that remained on the original lease, Hallandale gained an additional 12 years to operate the facility. This permitted Hallandale to project its costs and plan for the future. It could make additions and improvements to the building, buy new equipment, and provide for stability in staffing. On the other hand, had Hallandale refused to renegotiate the lease, it faced an uncertain future. There was a strong possibility that the owners would not be willing to renew the lease when it expired, which would result in Hallandale's losing the equipment and improvements it had put into the building. In addition, the owners were threatening to sell the property, and even though Hallandale had the right of first refusal, it would have had difficulty in obtaining the money required to purchase the property. Further, Hallandale realized that even if the owners would be willing to negotiate a new lease in 1986, Hallandale would not have the same leverage or bargaining power in 1986 as it had in 1983. Hallandale has participated in the Medicaid program continuously since 1971. At the time of the hearing the facility had 142 patients, of which 45 were Medicaid patients. 2/ Hallandale has never refused a Medicaid patient, and some of the patients have been there 8 or 9 years. The Medicaid patients are treated the same as the private patients, to such a degree that no one knows which patients are Medicaid patients. Although the agreement with HRS allows a provider to leave the Medicaid program with 30 days notice, Hallandale has no intention to ever discontinue participation in the Medicaid program. The extended term of the renegotiated lease is not only advantageous to Hallandale, it is also beneficial to Hallandale's patients, including Medicaid patients. It secures continuity of care for the patients and ensures that the patients will not have to be moved to a new facility in 1986. The transfer from one facility to another can be a very traumatic event for an elderly person; some patients have died within weeks of a transfer. Further, the patients benefit immediately because the extended term of the lease allows Hallandale to make improvements to the facility and buy equipment that it would not have been able to do without the security of a long term lease. The lease payments called for by the new lease are not out of line with lease payments made by similar institutions. Mr. Lerner looked at other lease payments being made in the community and found that $110 per bed per month was not an exorbitant amount. James Beymer leased nursing home facilities that were not as nice as the Hallandale facility for $138 per bed per month $166 per bed per month, and $225 per bed per month. Had Hallandale purchased the facility for $3 million, the price asked by the owners, the cost per month per bed would have been over twice the amount of the lease payment. 3/ Lease payments are included in a facility's "fixed costs." The fixed costs also include depreciation, real estate taxes and insurance. The state places a cap on reimbursement rates for fixed costs. In June 1983, prior to the renegotiation of the lease, Hallandale's fixed costs were $4.61 per patient day; under the renegotiated lease, the fixed costs would be $5.16 per patient day. Thus, even with the higher lease payment, the fixed costs are considerably under the state cap of $12.50 per patient day. A provider's reimbursement rate is determined by HRS from a cost report submitted by a provider. The rate is a prospective per diem rate. If, during the prospective period, the provider incurs an increase in costs, the provider has a right to submit an interim rate request to HRS. The Department uses the same principles to determine whether costs submitted in an interim rate request should be allowed as in determining whether costs submitted in a cost report should be allowed. Lease payments are allowable expenses under the Medicaid program subject to the Medicaid cost reimbursement principles. In calculating Hallandale's per diem rate, HRS allowed Hallandale $84 per month lease cost for each Medicaid patient in the facility based on the 1971 lease. Prior to executing the new lease, Hallandale contacted HRS to inquire if the new lease cost would be allowable and was informed that the new costs would probably not be allowable. On November 9, 1983, Hallandale submitted an interim rate request to cover the increased cost of the new lease payments. The interim rate request was procedurally correct. By letter dated May 30, 1984, HRS denied the interim rate request because "...the lease cost was negotiated for investment related reasons and is not related to patient care." On June 25, 1984, Hallandale filed its petition for a formal administrative hearing.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the interim rate increase requested by Hallandale be granted. DONE and ORDERED this 26th day of April, 1985, in Tallahassee, Leon County, Florida. DIANE A. GRUBBS Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of April, 1985.
The Issue Whether Petitioners' rental property was licensed under Chapter 509, Florida Statutes (2003).
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing, the following findings of fact are made: Petitioners, Robert Meller, Jr., and Kristine M. Meller, were owners of a rental property (a house located at 4516 Bowan Bayou) in Sanibel, Florida. In addition, they owned a condominium in the same area. Respondent Cross held a valid real estate license at all times material to matters at issue. Respondent Cross had a business relationship with Petitioners, which antedated the purchase of the Bowen Bayou house as a result of being the leasing agent for a condominium association with which Petitioners were associated. Respondent DBPR is the State of Florida agency which represents the FREC in matters such as this matter. In January 2000, Petitioners purchased the house in Sanibel located at 4516 Bowan Bayou. On or about January 20, 2000, Respondent Cross mailed a Rental Property Management Agreement to Petitioners for the property located at 4516 Bowan Bayou, Sanibel, Florida. The parties to this contract were Petitioners and Properties in Paradise, Inc. Petitioner, Robert Meller, Jr., signed the contract and returned the contract to Respondent Cross. Petitioners maintain that the Rental Property Management Agreement was not signed by Petitioner, Robert Meller, Jr., and that his name is forged. He maintains that he entered into an oral agreement with Respondent Cross, individually, to manage the property. From the purchase of the house in January 2000 through April 2001, Petitioners received correspondence, including a monthly "owner statement" reflecting short-term rental income, commissions, and debits for maintenance, from Properties in Paradise, Inc., regarding all aspects of the business relationship contemplated by the Rental Property Management Agreement. By letter dated January 20, 2000, Petitioner, Robert Meller, Jr., authorized "Revonda Cross of Properties in Paradise as my agent in establishing telephone and electrical service and so forth for my property on Sanibel Island at 4516 Bowen's [sic] Bayou Road." Thereafter, Petitioners received correspondence from Respondent Cross relative to the subject property wherein she is identified as "Operations Manager, Properties in Paradise, Inc." During the relevant time period, Petitioners' property was rented at least 22 times; once for 17 days, four times for 14 days, once for nine days, thirteen times for seven days, and once for five days. The frequency and term of these rentals qualify for the statutory definition of a "resort dwelling" and transient rental dwelling. Properties in Paradise, Inc., listed the property located at 4516 Bowan Bayou in the list of properties it provided the Division of Hotels and Restaurants as licensed in accordance with Chapter 509, Florida Statutes (2005). In April 2001, Properties in Paradise, Inc., through an attorney, notified clients that it had effectively ceased doing business. At that time, Petitioners were owed $11,588.06, which went unpaid. Petitioners made a claim in July 2001, against Respondent Cross to recover their loss from the Florida Real Estate Recovery Fund. In October 2003, Petitioners' claim was denied by the Florida Real Estate Recovery Fund.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Respondent, Department of Business and Professional Regulation, enter a final order denying Petitioners' claim for recovery from the Florida Real Estate Recovery Fund. DONE AND ENTERED this 21st day of February, 2006, in Tallahassee, Leon County, Florida. S JEFF B. CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 21st day of February, 2006. COPIES FURNISHED: Joseph A. Solla, Esquire Department of Business and Professional Regulation 400 West Robinson Street, Suite 801N Orlando, Florida 32801-1757 Robert L. Meller, Jr., Esquire Best & Flanagan, LLP 225 South 6th Street, Suite 4000 Minneapolis, Minnesota 55402-4690 Revonda Stewart Cross 1102 South East 39th Terrace, No. 104 Cape Coral, Florida 33904 Nancy B. Hogan, Chairman Florida Real Estate Commission 400 West Robinson Street, Suite 801N Orlando, Florida 32801 Josefina Tamayo, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202
