Recommendation Based upon the admission of the Respondent, Oscar Darias, that the allegations in the Administrative Complaint are true, and the Respondent's plea of guilty to the violations as charged in the Complaint, it is RECOMMENDED that the certified general contractor's license, number CG C004728, held by the Respondent, Oscar Darias, be revoked. THIS RECOMMENDED ORDER entered on this 22nd day of September, 1982, in Tallahassee, Florida. WILLIAM B. THOMAS 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 22nd day of September, 1981. COPIES FURNISHED: Harold M. Braxton, Esquire 45 S.W. 36th Court Miami, Florida 33135 Oscar Darias 9402 S.W. 17th Street Miami, Florida 33174
Findings Of Fact At all times relevant hereto, Respondent, James Everett Vose, III, held certified general contractor license number CG CA05417 issued by Respondent, Department of Professional Regulation, Construction Industry Licensing Board. He currently resides at 16308 Gulf Boulevard, No. 408, Redington Beach, Florida. In 1981 Respondent was the qualifying agent for Griffith and Vose, Inc., a construction firm doing business on the east coast of Florida. Respondent was owner and sole stockholder of the corporation. Thomas Griffith was employed by Respondent as field superintendent. On or about February 6, 1981 Griffith signed a contract on behalf of Griffith and Vose, Inc. with Oliver J. Fisher to construct a new home at 9945 Nicole Drive, Sebastion, Florida. The contract called for a total price of $39,500. The parties orally agreed that the house would be completed by September, 1981. Griffith and Fisher were acquainted with each other since Griffith had sold Fisher the lot on which the house was to be built. Fisher requested that the garage on the house be constructed initially because he could not pay all the draws immediately, and because he wished to store some personal be longings in the garage while the house was being built. Construction was begun around May, 1981 and continued until the house was approximately three-quarters completed in July, 1981. At that point the employees could not cash their paychecks drawn on the account of Griffith and Vose, Inc. Griffith called the local bank and was advised the firm's checking account had been closed. Griffith also began receiving telephone calls from local subcontractors and materialmen who complained of not being paid. Griffith attempted to contact Vose but was unsuccessful at first. When he did reach Vose, an apparent disagreement arose between the two, and Griffith was fired from his position with the firm. By this time Fisher had paid approximately $18,500 in draws to Griffith and Vose, Inc. He remitted an additional payment of $10,000 to Griffith on August 5, 1981 made payable to the firm. Griffith refused to turn it over to Vose and instead placed it in an escrow account with his attorney. Griffith then used the $10,000 to complete the house even though he was no longer employed by the firm. During this same period Vose had hired an attorney in an effort to get the $10,000 draw and certain other corporate assets that Griffith had taken from the firm. Be was unsuccessful in his efforts. The house was ultimately completed to Fisher's satisfaction. Fisher paid only what the contract called for, and was not required to expend any additional funds. Three materialmen provided materials and services on the project and were never paid. These included Lonestar Florida, Inc. ($870.48), Bobo Industries, Inc. ($1,622.40) and Ponce South Brevard Sewer and Septic Tank, Inc. ($916.48). To date they have not received their money. A fourth party (White Drywall) accepted a $1,000 settlement on a $1,649 bill for services rendered. Vose visited the job site a number of times while the house was under construction. He was actively involved in the supervision of the project. This was true even though he also worked as a sales representative at the same time. Respondent acknowledged that the Fisher house was never completed. He attributed his inability to finish the house to demands placed upon him by several other projects underway at the same time, a poor economic climate, and his unsuccesful effort to receive the last draw from Griffith. Because he knew Griffith was finishing up the job, he hoped "it would work itself out" without any further effort on his part. Respondent did hire two attorneys in an effort to sort out the mess, and to get the Fisher draw and other corporate assets which Griffith retained. He expressed a willingness to reimburse any parties who were unpaid, and regretted the unfortunate results of his dilemma.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent be found guilty as charged in Counts I and II of the administrative complaint; Count III should be DISMISSED. It is further RECOMMENDED that Respondent's certified general contractor license be suspended for six months and that reinstatement of said license be conditioned upon repayment of all moneys due and owing the three materialmen still unpaid. DONE and RECOMMENDED this 2nd day of May, 1983 in Tallahassee, Florida. DONALD R. ALEXANDER 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 2nd day of May, 1983. COPIES FURNISHED: John O. Williams, Esquire 547 North Monroe Street Suite 204 Tallahassee, Florida 32301 James E. Vose, III 16308 Gulf Boulevard, No. 408 Redington Beach, Florida 33708 James Linnan, Executive Director Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32202 Frederick M. Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
The Issue By its Administrative Complaint filed on January 15, 1985, the Department of Professional Regulation charged Respondent with violations of Section 489.129(1)(h)(k) and (m) Florida Statutes, relating to diversion of funds, abandonment of a construction project and gross negligence, incompetency or misconduct. The issue in this proceeding is whether any violation occurred and, if so, what disciplinary action should be taken. The Respondent generally denies the charges. At the hearing, the Petitioner presented two witnesses: Don Riordan, the home-owner; and Stephen Douglas Gates, an employee of Brooks Glass Company who did an estimate of cost of completion for the project. Four Petitioner's exhibits were admitted without objection: a check for payment by Don Riordan to A1 Ruocco, the Brooks Glass estimate, letter from William Bambach to A1 Ruocco and letter from Bob Bambach to Donald Riordan. A fifth exhibit was withdrawn. The Respondent testified on his own behalf and presented no other witnesses. His eight exhibits included the contract and a series of letters between himself and Robert Bambach. At the outset of the hearing, Petitioner moved for leave to file the testimony of Robert Bambach at a later date, due to unsuccessful attempts to serve a subpoena. The Respondent objected and the motion was denied. Petitioner waited until two days before the hearing to attempt to serve the prospective witness even though the hearing had been scheduled since June and the location of the hearing had been established for two weeks. Petitioner filed its Proposed Recommended Order on November 1, 1985; none was filed by Respondent. The proposed findings of fact have been primarily adopted herein but are addressed more specifically in Appendix A, attached to this order.
Findings Of Fact The facts in this case are virtually uncontroverted, with the exception of the months and sequences of some events. At all times material to the Administrative Complaint, Respondent was a registered building contractor holding license number RB0030112, which license qualified River's Edge Construction Company, Inc., Melbourne, Florida. On March 11, 1983 a contract was entered between Albert Ruocco, President, River's Edge Construction Co., Inc. ("Ruocco") and Don Riordan, Jr., ("Riordan") to enclose a balcony with bronze awning windows and bronze tinted glass at Riordan's townhouse residence in Melbourne Beach, Florida. Ruocco and Riordan knew each other socially as Ruocco was a neighbor of Riordan's parents. Ruocco was recommended for the job by Riordan's parents. On March 31, 1983, Riorden paid Ruocco $1300.00 or the $1853.00 contract price. Riordan testified that Ruocco was doing him a favor because it was repair work and the principal amount of money was being paid up front to avoid a cash-flow problem on materials. (T-18). The idea was to get the work done as soon as possible. (T-16). Sometime around May or June 1983, the construction started with removal of existing screening and the installation of an aluminum kick plate and posts to hold the awning window frames. Sometime later the windows were put in for the first time. The actual work on the project was done by a Mr. Bambach, rather than Ruocco. What followed the first installation was a series of misadventures culminating in a lawsuit by Riordan and an $800.00 civil judgment against Ruocco. The work was never completed. The first windows installed were clear glass rather than tinted bronze. Riordan complained to Ruocco and the windows were removed within twenty-four hours. The windows were installed again, this time with film rather than tinted glass and Riordan called Ruocco the next day. Again the windows were removed immediately. Some time passed (by now it was early August) and bronze-tinted windows were installed. However, after a rain storm it became apparent that the installation was faulty, as the structure leaked. The metal strips had been damaged from the several removals. Riordan complained the third time and the windows were removed a third time. They were never replaced. Throughout this period Riordan was dealing with Ruocco, with whom he had the contract and Ruocco was dealing with Bambach, to whom he had given $800.00 as partial payment for the work. Relations between the individuals deteriorated as months passed and the windows were still not finally installed. Riordan called Ruocco about getting the work done and was told that Ruacco was having trouble with his worker. By the end of 1983 Riordan's attorney called Ruocco and said that the money had to be refunded. In the meantime, a stand-off had developed between Ruocco and Bambach, with Ruocco insisting that the work be completed prior to final payment and Bambach insisting that he be paid prior to re- installation of the windows. Bambach had taken the windows to a glass company to be fixed. Bambach alleged in his correspondence that Ruocco did not have the money to pay him, while Ruocco alleged that he tried to meet Bambach to give him the money but Bambach didn't show up. Ruocco testified that he possibly could have installed the windows himself but was trying to get Bambach to complete the job. (T-57). He further testified that he had two other persons look at the job but they wouldn't touch someone else's work. (T-58). Sometime in early 1984 Ruocco was made to understand that Riordan was not interested in waiting any longer for the project to be finished and wanted his money back.
Recommendation On the basis of the foregoing, I recommend that the Respondent be found guilty of misconduct as provided in Subsection 439.129(1)(m) Florida Statutes, and be reprimanded in accordance with Subsection 489.129(1) Florida Statutes. DONE and ORDERED this 12th day of November, 1985, in Tallahassee, Florida. MARY CLARK, 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 12th day of November, 1985. APPENDIX In accordance with Section 120.59(2) Florida Statutes, the following are recommended rulings on proposed findings of facts submitted by Petitioner in this case. The numbered paragraphs below conform to the paragraphs proposed by Petitioner. These findings are incorporated in Recommended Order, paragraph 1. These findings are incorporated in Recommended Order, paragraphs 2 and 6. These finding are incorporated in Recommended Order, paragraph 3. These findings are incorporated in Recommended Order, paragraph 5. These findings are incorporated in Recommended Order, paragraph 5. These findings are incorporated in Recommended Order, paragraph 5. These findings are incorporated in Recommended Order, paragraph 7. The findings related to the estimate of Brooks Glass Company are irrelevant. The estimate was done approximately one and a half years after the contract was entered between Riordan and Ruocco. The witness from Brooks Glass who testified about the estimate could not relate the quality of Brooks' windows to those intended by Ruocco for the project. (T. 41-43). To the extent that these findings are proposed to show the extent to which the project was left uncompleted, the fact that the windows were never re- installed was admitted by Ruocco and is reflected in Recommended Order paragraphs 4 and 5. These findings are incorporated in Recommended Order paragraphs 7 and 8. COPIES FURNISHED: Fred Roche, Seeretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Salvatore A. Carpino, Esquire General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Douglas Beason, Esquire Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Mr. Albert J. Ruocco 604 Citrus Court Melbourne, Florida 32951
Findings Of Fact At all times material hereto, Respondent has been a certified building contractor in the State of Florida, having been issued License No. CB CO24584. At all times material hereto, Respondent was the qualifying agent for Southern Construction Technologies, Inc. In March, 1988, Alfred and Martha Entrekin entered into a contract with Southern Construction Technologies, Inc., whereby they agreed to pay the sum of $178,000 for construction of a custom-built home. Since the Entrekins were unable to qualify for the financing needed for construction, Southern Construction obtained a construction loan on their behalf. Despite delays, construction commenced in May of 1988 and continued through October, when, the closing on the residence took place, subsequent to the issuance of a certificate of occupancy by the Town of Davie. Just prior to the closing, a "punchlist" was prepared by Respondent and the Entrekins. That punchlist, which became part of the closing, contains 24 numbered items. (Due to misnumbering, the punchlist says 25.) Thirteen 0of those items on the copy of the punchlist offered in evidence by the Petitioner have been crossed off that list. Of the remaining 11 items, the evidence at final hearing reveals that some were corrected and some items were not the subject of any evidence offered by either party at the final hearing. Although additional items appear to have been added to the punchlist by the Entrekins sometime after the closing, those items will not be considered in this cause since no evidence was offered to indicate that those items were agreed to by the Respondent at the time of closing and no evidence was presented as to when those items were added to the original punchlist by the Entrekins. At the time of closing, the sum of $1,500 was placed in escrow to ensure completion of the punchlist by Respondent. Respondent performed some of the punchlist work on the day of the closing and continued working on the punchlist items for the next three weeks. On January 11, 1989, the Entrekins' attorney sent a demand letter seeking the release of the funds placed in escrow at the closing. Attached to that demand letter was a list of 16 items allegedly remaining on the punchlist. Some of the items on the new "punchlist" submitted by the Entrekins did not appear on the punchlist agreed to by the parties at the closing. Others did appear on the closing punchlist but had been struck through and initialed by Mrs. Entrekin, assumedly as having been completed, on the copy of the closing punchlist offered by Petitioner as an exhibit in this cause. In response to the demand letter, Respondent authorized the release of the $1,500 in escrow to the Entrekins. Respondent admits that at the time that the money was released to the Entrekins, there were still some repairs needed to the rake tiles on the roof and he had not seeded the backyard. Respondent testified that four rake tiles on the eaves were missing, some were misaligned, and some had not been "mudded" in with mortar, but no broken tiles remained on the roof. He also testified that he had not seeded the backyard because the Entrekins had not yet placed fill in the backyard, an item which Mr. Entrekin admits was his responsibility as provided in the contract between the Entrekins and Southern Construction Technologies, Inc. The only evidence submitted in corroboration of the complaints of the Entrekins consists of several invoices. In March, 1989, the Entrekins obtained an estimate for roof repairs from Warren Roofing, Inc., in the amount of $1,200. That invoice indicates the need to replace 80 broken tiles on the roof, the need to remove and replace approximately 130 rake tiles to be secured with mortar tinted to match (although Donald Warren testified that the tile used is nail-on tile which does not require mortar), and the need to "repair defects" in two rear valley areas. Warren Roofing was never hired to effectuate the repairs for which it had submitted its $1,200 estimate. The extensive work set forth in the estimate in March of 1989 is inconsistent with the roofing inspection which would have taken place prior to the certificate of occupancy issued prior to the closing in October of 1988. The only roofing repair effectuated to the Entrekin house by anyone other than Respondent was work performed by Warren Roofing in July of 1989 repairing a leak around the skylight. Petitioner also offered in evidence two invoices from pool services dated March of 1989. One invoice in the amount of $275 represents the cost of acid washing the pool, and the other invoice is for $230 to "filter pool water." Due to electrical problems, the water in the pool was not filtered for two days during the period of construction of the Entrekin house. No evidence was offered to show that the absence of filtering a pool for two days would require it to be acid washed, and no evidence was offered in support of the services performed or the need for the services represented by the second invoice. Another invoice represents the cost of 20 loads of muck for the backyard at a cost of $600, and $150 to rent a bulldozer. Since the muck for the backyard was the responsibility of the Entrekins, the bulldozer charge accompanying the 20 loads of muck is, in all probability, also the responsibility of the Entrekins. The last invoice submitted in evidence also bears the date of March of 1989 and represents 50 pounds of grass seed, in the amount of $110.50, a cost item which Respondent admits was his responsibility at the time that the escrowed monies were released to the Entrekins.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding Respondent not guilty of the allegations contained in the Administrative Complaint filed against him and dismissing the Administrative Complaint. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 25th day of January, 1991. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of January, 1991. COPIES FURNISHED: Charles N. Tetunic, Esquire Becker, Poliakoff & Streitfeld, P.A. Post Office Box 9057 Fort Lauderdale, Florida 33310-9057 Joseph Stephen Sharrow, Esquire Post Office Box 8995 Fort Lauderdale, Florida 33310 Daniel O'Brien Executive Director Department of Professional Regulation Construction Industry Licensing Board Post Office Box 2 Jacksonville, Florida 32202 Kenneth E. Easley General Counsel Department of Professional Regulation 1940 North Monroe Street, Suite 60 Tallahassee, Florida 32399-0792
The Issue Whether Respondent’s use of explosives in connection with construction materials mining activities caused damages to Petitioners’ home, and, if so, the amount of damages to which Petitioners are entitled.
Findings Of Fact The Parties Petitioners reside in a single-family, one-story home located at 14699 Southwest 47th Street, Miramar, Broward County, Florida 33027. Petitioners are the third owners of the home, which was built in 1981. Petitioners have resided in the home since 1998. The home is approximately 3,000 square feet “under air,” and is composed of concrete block with stucco finishes, a shallow slab-on-grade foundation system, wood-framed interior walls, and ceramic tile flooring. Respondent engages in construction materials mining activities in Miami-Dade County, Florida. Specifically, Respondent utilizes explosives to procure construction materials (i.e., limestone) from quarries that are located in northwest Miami-Dade County, Florida. Respondent’s Blasting Activities The subject quarries are located within various geographic areas identified by different sections. Of particular relevance to the instant matter are sections 7, 6, and 4/5. Section 7 is approximately 2.6 or 2.7 miles from Petitioners’ home. Section 6 is approximately 2.3 or 2.4 miles from Petitioners’ home. Section 4/5 is approximately 1.6 miles from Petitioners’ home. Each of the sections have been utilized as a discrete location where blasting activities occur in order for Respondent to obtain construction materials. Section 7 was in operation from the mid-1990s through the end of 2015. Currently, no blasting activities occur in section 7. Section 6 was in operation from 2000 through 2015. Currently, no blasting activities occur in section 6. Section 4/5 began blasting operations in the first quarter of 2015 and halted in the fourth quarter while excavation was done. Blasting in section 4/5 resumed in January 2016. To monitor the impact of its blasting activities, Respondent utilizes the firm GeoSonics, Inc. (“GeoSonics”). GeoSonics has performed vibration measurement, evaluation, and reporting to Respondent since 1986. Jeffrey A. Straw is a seismologist with 39 years of experience and is employed by GeoSonics. As a seismologist, Mr. Straw is responsible for monitoring the impacts of vibration from Respondent’s blasting activities and analyzing their effects on structures. GeoSonics placed seismographs to monitor the impact of Respondent’s blasting activities. Peak particle velocity (“PPV”) is the speed at which a particle of ground oscillates as the vibration wave moves through the ground. The seismographs are used to determine if Respondent’s blasting activities are within the PPV limit of 0.5 inch per second established by the state of Florida. The seismographs must be located within one mile of each blast location to record the PPV resulting from the blasting activities. The seismographs are monitored and evaluated to ensure that their readings are accurate. The seismograph readings are evaluated by GeoSonics, which provides reports on the readings to Respondent and to the state fire marshall. Each seismograph undergoes testing to ensure that the instrument is working properly and providing effective and accurate readings. Every time a seismograph provides a reading concerning a blast, it sends a calibration pulse, which indicates whether the seismograph is working properly. Each seismograph instrument has an accompanying certification demonstrating that the instrument has successfully undergone testing and is working in accordance with the industry standards and specifications. There are six seismographs located within the vicinity of Petitioners’ home. The further the distance from the blasting location, the lower the blasting intensity. Each seismograph is located closer to the blasting location than Petitioners’ home. Thus, the PPV measured by the seismographs are greater than what the blasting intensity would be at Petitioners’ home. At no time have any of Respondent’s blasting activities reached or exceeded the 0.5 PPV limit. Petitioners Failed to Prove that Respondent’s Blasting Activities Caused Damages to Their Home In the instant case, Petitioners assert that Respondent’s quarrying activities caused damages to their home. Petitioners’ alleged damages center on “cracks” that exist throughout the home--specifically, cracks throughout the tile flooring inside the home; cracks on the cement flooring of the garage; cracks in the interior and exterior walls and ceilings; cracks in the semi-circular, stamp-concrete driveway and patio; and cracks around the surface of the windows. It is clear that cracks exist in Petitioners’ home. However, the issue to be determined in this case is whether the cracks were caused by Respondent’s blasting activities. They were not. In support of Petitioners’ position, Mrs. Alfaro presented at hearing a home inspection report. The inspection was conducted on April 18, 2016, and was not performed by a general contractor or structural engineer. Although the inspector identified various cracks based on his visual observations, the inspector specifically excluded any opinion regarding the cause of any need for repairs. Petitioners were specifically advised to obtain an opinion from a general contractor or structural engineer as to the cause of the damages. Mrs. Alfaro is an electrical contractor. She is not a licensed general contractor or structural engineer. At hearing, Mrs. Alfaro conceded that she does not have experience as a general contractor or seismologist. She has not had any training in seismology or blasting activities. Mrs. Alfaro’s testimony at hearing regarding the purported cause of the cracks is not credited and is unpersuasive. At hearing, Mrs. Alfaro presented the testimony of Barbara Hagan. Ms. Hagan resides in Country Club, Miami-Dade County, Florida, and is retired. She serves as the president of a civic association and secretary and treasurer of her homeowner’s association. She is not a general contractor, engineer, or seismologist. She has no experience in the use of explosives. She has never visited Petitioners’ home. At hearing, Ms. Hagan conceded that she has no opinion regarding the cause of any of the damages in Petitioners’ home. Mrs. Alfaro also presented the testimony of Paul Ingelmo. Mr. Ingelmo is a structural engineer who performed a visual inspection of Petitioners’ residence. Mr. Ingelmo did not review or analyze PPV data relevant to the blasts complained of by Petitioners. Mr. Ingelmo has no training or experience as to the appropriate threshold with respect to blasting activities and PPV. He is not familiar with how a wave behaves from a blast versus a seismic event. Mr. Ingelmo is not familiar with how PPV is measured or calculated. Importantly, Mr. Ingelmo could not give an opinion on whether the damages to Petitioners’ home were caused by Respondent’s blasting activities. In fact, Mr. Ingelmo conceded that the damages could have been caused by any number of unspecified factors. Finally, Mrs. Alfaro presented the testimony of Ismailia Rashid. Ms. Rashid is a general and roofing contractor. Ms. Rashid visited Petitioners’ home, conducted a visual inspection, and observed cracks on the patio, interior floors, and driveway. Ms. Rashid is not familiar with PPV or ground vibration. She has never been in a home where she was present and there was blasting. Importantly, Ms. Rashid did not offer an opinion on whether the damages to Petitioners’ home were caused by Respondent’s blasting activities. In sum, Petitioners failed to prove by a preponderance of the evidence that the damages to their home were caused by Respondent’s blasting activities. Rather, the preponderance of the evidence presented at hearing demonstrates that the damages to Petitioners’ home were not caused by Respondent’s blasting activities. In reaching this conclusion, the undersigned credits and finds persuasive the testimony of Respondent’s witnesses: Jeffrey A. Straw, David L. Teasdale, and Michael Schraeger. Mr. Straw visited Petitioners’ home twice: in April 2006 and January 2016. At those visits, Mr. Straw accompanied Michael Schraeger, a licensed general contractor with Diversified Services, Inc. On both occasions, Mr. Straw brought a camera and notepad with him to catalog the defects identified by Petitioners. Mr. Straw took extensive and comprehensive photographs detailing the cracks throughout Petitioners’ home and driveway. Mr. Straw testified that 90 percent of the alleged defects he observed in 2016 were items that he also observed in some format in 2006.1/ Mr. Teasdale is a civil structural engineer with Haag Engineering and serves as vice president of engineering and principal field engineer. Mr. Teasdale’s specialty focuses on the extent of damage to structures due to ground vibrations, explosions, and earthquakes. He is a licensed engineer in the state of Florida and 34 other states and has been a licensed engineer since 1988. He is extensively familiar with seismographs and has extensive experience installing and using them. Mr. Teasdale was accepted by the undersigned as an expert in structural behavior from ground motion and normal service loads, the influence of construction practices and environmental conditions on building features, soils and hardscape, the causes and conditions documented at the Petitioners’ residence, and lot features including the suitability of existing safe blasting standards in the state of Florida. Mr. Teasdale testified that there are substantial differences between an earthquake and quarry blasting. Mr. Teasdale explained that the fundamental difference between an earthquake and a quarry blasting is the amount of energy being released by the activity. Quarry blasting is a localized source event. An earthquake involves a fault line, which can extend for many miles and become mobilized. There is a direct correlation between the length of a fault line ripped versus the magnitude of an earthquake. Mr. Teasdale also explained that the measurement for quarry blasting, unlike the Richter Scale used for earthquakes, is a direct measurement; meaning that a PPV of 1.0 is twice the impact of a PPV of 0.5. Mr. Teasdale testified that for blasting to cause damage to a structure, distortion must occur. Distortion occurs where the foundation of a structure is accelerated laterally and causes the upper-part of the building to lag in response, which causes the building to shift back-and-forth and mimic a parallelogram shape. He explained that when distortion occurs, cracks will emanate from the corner of the walls and that those cracks will be mirrored on the opposite walls (inside and outside the structure). Mr. Teasdale explained that there was no damage to the foundation of Petitioners’ home, and the foundation and floor of a home would not experience distortion at 0.5 PPV or below because those limits are too low to produce the energy necessary to cause a structure to become mobilized. According to Mr. Teasdale, Petitioners’ home exhibited a variety of horizontal and vertical cracks and separations in the finishes, which are typical of environmental stresses in those materials. Mr. Teasdale also testified that distortion causes diagonal cracks, while thermal environmental stresses cause cracks vertically and horizontally. He explained that cracks caused by environmental conditions do not correlate on the inside and outside, while cracks caused by distortion do correlate on the inside and outside. He emphasized that the absence of corresponding cracks on the inside and outside of the structure generally precludes blasting as the cause of damages. Mr. Teasdale explained that from the moment the concrete is cast, it begins to shrink and develop cracks. Mr. Teasdale further explained that stucco, which is essentially the same material as concrete, is also prone to cracks due to normal environmental conditions. Mr. Teasdale testified that at the level in which Respondent has blasted below 0.5 PPV, it is impossible for Respondent’s blasting to have caused damages to Petitioners’ home. Based on his review and analysis of Petitioners’ home, Mr. Teasdale concluded that he would exclude blasting to a reasonable degree of scientific certainty as the cause of damages to Petitioners’ home. Mr. Schraeger is a general contractor and building inspector. He is self-employed through his company Diversified Services, Inc., and serves as the owner/operator. Mr. Schraeger has approximately 30 years of experience in commercial and residential construction. He has been licensed as a general contractor for 22 years and specializes in repairs, remodeling, and renovations of commercial and residential structures. He has 20 years of experience performing inspections of buildings relating to determination of material, construction failure, and defects. Mr. Schraeger was accepted by the undersigned as an expert in construction practices and environmental effects on materials and structures. Mr. Schraeger inspected Petitioners’ home in 2006 and 2016. He testified that 90 to 95 percent of the alleged defects he observed in Petitioners’ home in 2016 existed when he inspected the home in 2006. Mr. Schraeger testified that the cracks that he observed on the tile floor inside Petitioners’ home are very typical in a South Florida home because concrete typically cracks within all concrete structures. These types of cracks can be caused by poor installation of the tile or shrinkage of the monolithic slab over time. There was no evidence of foundation damage.2/ Mr. Schraeger further testified that in his professional opinion, some of the cracks in Petitioners’ home are the result of poor construction practices. For example, he explained that most of the cracks in the interior of Petitioners’ home are due to poor construction practices because of the use of an inappropriate method for finishing the joints in the drywall. During his 2016 inspection, Mr. Schraeger observed tape on some of the joints, which either had no joint compound under them, or the tape was applied after the compound started to dry, causing a bond failure. Some of the cracks generating from the corners of openings appeared to be from improperly secured corner bead. During his 2016 inspection, Mr. Schraeger also observed a crack in the master bedroom approximately eight feet in length, which appeared to be a joint in the drywall. This was apparent to Mr. Schraeger because the crack was visible on both sides of the joint tape, which had failed. According to Mr. Schraeger, the cause of this failure was moisture from a roof leak. Staining due to moisture on the ceiling in the area and a repair of the roof above this area indicated a previous leak. Notably, other areas of the home indicated roof leaks, including stains on the ceiling of the office area and staining around the skylight in the hallway. Mr. Schraeger further testified that the patio tile and driveway lack sufficient control joints, thereby making the stamped-concrete driveway and patio prone to crack. Mr. Schraeger also identified issues of poor maintenance by Petitioners. For example, he noted that the caulking around the windows was brittle and almost nonexistent. At hearing, Mrs. Alfaro acknowledged that in the 17 years she has owned the home, the windows have never been re-caulked. According to Mr. Schraeger, several cracks were observed on the stucco exterior walls of the home. With the exception of a severe crack on the wing wall on the rear of the patio, all of the cracks in the exterior walls of the home were attributed to common aesthetic cracks caused by the lack of control joints, dissimilar materials, bond failure, and improper maintenance. The crack on the wing wall of the patio, which ran along the bottom of a large tie beam, was attributable to poor construction methods.
The Issue Whether Petitioner, White Rock Quarries (“White Rock”), is entitled to an award of attorney’s fees to be paid by Respondents, Dorothy Brown-Alfaro and Amilcar Alfaro (“Respondents” or “Ms. Alfaro”), pursuant to section 57.105, Florida Statutes, and an award of attorney’s fees and taxable costs to be paid by Respondents pursuant to section 552.40(9), Florida Statutes; and, if so, the amount of attorney’s fees and taxable costs to which White Rock is entitled.
Findings Of Fact White Rock engages in construction materials mining activities in Miami-Dade County, Florida. Specifically, White Rock utilizes explosives to procure construction materials (i.e., limestone) from quarries that are located in northwest Miami-Dade County, Florida. Respondents reside in a single-family, one-story home located at 14699 Southwest 47th Street, Miramar, Broward County, Florida 33027. Respondents are the third owners of the home, which was built in 1981. Respondents have resided in the home since 1998. The home is approximately 3,000 square feet “under air,” and is composed of concrete block with stucco finishes, a shallow slab-on-grade foundation system, wood-framed interior walls, and ceramic tile flooring. The subject quarries are located within various geographic areas identified by different sections in close proximity to Respondents’ home. Of particular relevance to the instant matter are sections 7, 6, and 4/5. Section 7 is approximately 2.6 or 2.7 miles from Respondents’ home. Section 6 is approximately 2.3 or 2.4 miles from Respondents’ home. Section 4/5 is approximately 1.6 miles from Respondents’ home.1/ In the underlying case, Respondents asserted that White Rock’s quarrying activities caused damages to their home. Respondents alleged damages centered on “cracks” that exist throughout the home--specifically, cracks throughout the tile flooring inside the home; cracks on the cement flooring of the garage; cracks in the interior and exterior walls and ceilings; cracks in the semi-circular, stamp-concrete driveway and patio; and cracks around the surface of the windows. It is undisputed that cracks exist throughout Respondents’ home and that Respondents’ home is damaged because of the cracks. However, the issues to be determined in the underlying proceeding were whether the cracks were caused by White Rock’s blasting activities, and, if so, the amount Respondents should be compensated for the damages. Section 552.40(1) provides, in pertinent part, that: A person may initiate an administrative proceeding to recover damages resulting from the use of explosives in connection with construction mining materials mining activities by filing a petition with the Division of Administrative Hearings by electronic means through the division’s website on a form provided by it . . . . Pursuant to section 552.40(2)(c) and (d), the petition must include: The approximate time, date, and place of the use of explosives which is alleged to have resulted in damage to the petitioner; and A description of the damage caused and the amount sought for recovery. On December 14, 2015, Respondents’ former counsel filed an Amended Petition Under the Florida Construction Materials Mining Activities Administrative Recovery Act. In the amended petition prepared and filed by Respondents’ former counsel pursuant to sections 552.40(1) and (2), Respondents claimed they were entitled to the following items of damages caused by White Rock’s blasting activities: Floor ($24,000) Foundation ($100,000) Walls ($50,000) Ceiling ($20,000) Patio ($50,000) Driveway ($75,000) Windows ($45,000)2/ The final hearing in the underlying proceeding lasted two days. At that hearing, Respondent Dorothy Brown-Alfaro (who appeared pro se at the final hearing), presented photographs and a home inspection report showing cracks throughout the home. She described new, worsening, and expanding cracks throughout the home resulting from White Rock’s blasting activities. In addition, Ms. Alfaro submitted into evidence a blasting log, which documented the date, time, and intensity of White Rock’s ongoing blasting activities since 1999 Respondents claimed they felt at their home. The blasting log was also an exhibit to Respondents’ amended petition. At the hearing, Ms. Alfaro testified to White Rock’s frequent blasting and the effects on her home from the blasts. According to Ms. Alfaro, when White Rock’s blasting activities occur, the house “sways,” “everything shakes,” and “the entire structure of my house moves.” According to Ms. Alfaro, “when it shakes, my ceiling, my roof, my walls, my floor, everything shakes.” She testified that items fall off the shelves and she described the feeling from the blasts as a “vibration similar to an earthquake.” Ms. Alfaro presented the additional testimony of Barbara Hagan, Paul Ingelmo, and Ismailia Rashid. Mr. Ingelmo is a structural engineer who performed a visual inspection of Respondents’ residence. Ms. Rashid is a general and roofing contractor. Neither Mr. Ingelmo, Ms. Rashid, nor Ms. Hagan could opine that the damages to Respondents’ home were caused by White Rock’s blasting activities. Ms. Alfaro is an electrical contractor. She is not a licensed general contractor or structural engineer. At hearing, Ms. Alfaro conceded that she does not have experience as a general contractor or seismologist. She has not had any training in seismology or blasting activities. The undersigned found Ms. Alfaro’s testimony regarding the purported cause of the cracks not to be credited or persuasive. Ms. Alfaro regularly provides construction estimates in her business. Ms. Alfaro testified that the damages she requested in the amended petition were based upon her estimate of the repair costs she would incur to correct the damages caused by White Rock’s blasting activities. She testified, without objection, that she obtained material costs and calculated the amount of materials needed (i.e. per cubic yard of concrete and drywall) and labor to complete the repairs. In response to the evidence presented by Ms. Alfaro at the hearing, White Rock presented the testimony of Jeffrey A. Straw, a seismologist; David L. Teasdale, a civil structural engineer; and Michael Schraeger, a general contractor and building inspector. As a seismologist, Mr. Straw was responsible for monitoring the impacts and vibration from White Rock’s blasting activities and analyzing their effects on structures. At the hearing, he described the concept of peak particle velocity (“PPV”), the speed at which a particle of ground oscillates as the vibration wave moves through the ground following a blast. Mr. Straw testified that according to seismographs located within the vicinity of Respondents’ home, at no time have any of White Rock’s blasting activities reached or exceeded the PPV limit of 0.5 inch per second established by the state of Florida. Mr. Straw also visited Respondents’ home twice: in April 2006 and January 2016. On both occasions, Mr. Straw brought a camera and notepad with him to catalog the defects identified by Respondents. Mr. Straw took extensive and comprehensive photographs detailing the cracks throughout Respondents’ home and driveway. Mr. Straw also testified that 90 percent of the alleged defects he observed in 2016 were items that he also observed in some format in 2006.3/ While at Respondents’ home in January 2016, Mr. Straw experienced the effects of a blast. He described it as “[r]elatively minor based on blasts that I felt,” and indicated the blast lasted about three to five seconds at most. However, Mr. Straw further testified that he could feel the impact of the blast under his feet, and he could hear it, “there was some general vibration of the structure,” and some “dish rattling.” Mr. Teasdale is extensively familiar with seismographs and has extensive experience installing and using them. At the hearing, he was accepted by the undersigned as an expert in structural behavior from ground motion and normal service loads, the influence of construction practices and environmental conditions on building features, soils and hardscape, the causes and conditions documented at Respondents’ residence, and lot features including the suitability of existing safe blasting standards in the state of Florida. Mr. Teasdale explained the substantial differences between an earthquake and quarry blasting. Mr. Teasdale testified that for blasting to cause damage to a structure, distortion must occur. According to Mr. Teasdale, distortion occurs where the foundation of a structure is accelerated laterally and causes the under part of the building to lag in response, which causes the building to shift back and forth and mimic a parallelogram shape. He explained that when distortion occurs, cracks will emanate from the corner of the walls and that those cracks will be mirrored on the opposite walls (inside and outside the structure). Mr. Teasdale testified there was no damage to the foundation of Respondents’ home, and the foundation and floor of a home would not experience distortion at 0.5 PPV or below because those limits are too low to produce the energy necessary to cause a structure to become mobilized. According to Mr. Teasdale, Respondents’ home exhibited a variety of horizontal and vertical cracks and separations in the finishes, which are typical of environmental stresses in those materials. Mr. Teasdale also testified that distortion causes diagonal cracks, while thermal environmental stresses cause cracks vertically and horizontally. He explained that cracks caused by environmental conditions do not correlate on the inside and outside, while cracks caused by distortion do correlate on the inside and outside. He emphasized that the absence of corresponding cracks on the inside and outside of the structure generally precludes blasting as the cause of damages. Mr. Teasdale explained that from the moment the concrete is cast, it begins to shrink and develop cracks. Mr. Teasdale further explained that stucco, which is essentially the same material as concrete, is also prone to cracks due to normal environmental conditions. Based on his review and analysis of Respondents’ home, Mr. Teasdale concluded that he would exclude blasting to a reasonable degree of scientific certainty as the cause of damages to Respondents’ home. Mr. Schraeger has been licensed as a general contractor for 22 years and specializes in repairs, remodeling, and renovations of commercial and residential structures. He has 20 years of experience performing inspections of buildings relating to determination of material, construction failure, and defects. At the hearing, Mr. Schraeger was accepted by the undersigned as an expert in construction practices and environmental effects on materials and structures. Mr. Schraeger inspected Respondents’ home in 2006 and 2016. He testified that 90 to 95 percent of the alleged defects he observed in the home in 2016 existed when he inspected the home in 2006. Mr. Schraeger testified that the cracks that he observed on the tile floor inside Respondents’ home are very typical in a South Florida home because concrete typically cracks within all concrete structures. These types of cracks can be caused by poor installation of the tile or shrinkage of the monolithic slab over time. He opined there was no evidence of foundation damage. Mr. Schraeger further testified that in his professional opinion, some of the cracks in Respondents’ home are the result of poor construction practices. For example, he explained that most of the cracks in the interior of the home are due to poor construction practices because of the use of an inappropriate method for finishing the joints in the drywall. During his 2016 inspection, Mr. Schraeger observed tape on some of the joints, which either had no joint compound under them, or the tape was applied after the compound started to dry, causing a bond failure. Some of the cracks generating from the corners of openings appeared to be from improperly secured corner bead. During his 2016 inspection, Mr. Schraeger also observed a crack in the master bedroom approximately eight feet in length, which appeared to be a joint in the drywall. This was apparent to Mr. Schraeger because the crack was visible on both sides of the joint tape, which had failed. According to Mr. Schraeger, the cause of this failure was moisture from a roof leak. Staining due to moisture on the ceiling in the area and a repair of the roof above this area indicated a previous leak. Notably, other areas of the home indicated roof leaks, including stains on the ceiling of the office area and staining around the skylight in the hallway. Mr. Schraeger further testified that the patio tile and driveway lack sufficient control joints, thereby making the stamped-concrete driveway and patio prone to crack. Mr. Schraeger also identified issues of poor maintenance by Respondents. For example, he noted that the caulking around the windows was brittle and almost nonexistent. At the hearing, Mrs. Alfaro acknowledged that in the 17 years she has owned the home, the windows have never been re-caulked. According to Mr. Schraeger, several cracks were observed on the stucco exterior walls of the home. With the exception of a severe crack on the wing wall on the rear of the patio, he opined that all of the cracks in the exterior walls of the home were attributed to common aesthetic cracks caused by the lack of control joints, dissimilar materials, bond failure, and improper maintenance. According to Mr. Schraeger, the crack on the wing wall of the patio, which ran along the bottom of a large tie beam, was attributable to poor construction methods. At the hearing, Mr. Schraeger disputed Ms. Alfaro’s cost of repair testimony. However, Mr. Schraeger was not asked to give an expert opinion regarding the amount of damages, and he provided only “ballpark” or “rough” estimates of the cost of repair. For example, Mr. Schraeger testified that the cost to repair the flooring would be “approximately $11,000.”4/ As to the foundation, he estimated the cost to be $0.00 because he found no damage. As to the walls, Mr. Schraeger estimated a figure of $16,000. As to the ceiling, Mr. Schraeger estimated a figure of $5,000. As to the patio, Mr. Schraeger estimated a figure “well within the high end of six thousand.” As to the driveway, Mr. Schraeger estimated a range between “roughly” $17,000 and $20,000--the high end of the range resulting from “material fluctuation” construction costs. As to the windows, Mr. Schraeger estimated $12,000. Clearly, Mr. Schraeger acknowledged there are actual damages throughout much of the home, and there are actual costs associated with the repair of the damages. That the parties disagreed as to the amount of damages as to each item of alleged damages does not mean that the amount of damages claimed was unsupported by the material facts necessary to establish the claim. In sum, based on the evidence adduced at the hearing, the undersigned found that Respondents failed to prove by a preponderance of the evidence that the damages to their home were caused by White Rock’s blasting activities. Rather, the preponderance of the evidence presented at hearing established that the damages to Respondents’ home were not caused by White Rock’s blasting activities. In reaching this conclusion, the undersigned credited and found persuasive the testimony of Mr. Straw, Mr. Teasdale, and Mr. Schraeger. Although the undersigned was not persuaded in the underlying case by the evidence presented by Respondents, this does not mean that Respondents’ claims were not supported by the material facts necessary to establish the claims. There was competent, substantial evidence introduced by Respondents at hearing showing that: (1) Respondents’ home was in close proximity to White Rock’s frequent blasting activities; (2) when the blasting occurs, the house “sways,” “everything shakes,” “the entire structure of [the] house moves,” items fall off the shelf, and Ms. Alfaro feels a vibration similar to an earthquake; and (3) there are cracks throughout the home--some of the cracks are new, worsening, and have expanded as a result of White Rock’s frequent blasting activities. White Rock is the prevailing party in Dorothy Brown- Alfaro and Amilcar Alfaro v. White Rock Quarries, DOAH Case No. 15-6014CM. However, White Rock has failed to establish it is entitled to an award of attorneys’ fees pursuant to sections 57.105 and 552.40(9). On page 16 of its proposed final order, White Rock also claims it is entitled to recover taxable costs under section 552.40(9), totaling $9,287, as the prevailing party in the underlying case. The amount of taxable costs claimed is based on Exhibits 12A through 12G. In Respondents’ Proposed Final Order, Respondents do not dispute that White Rock is entitled to “recover costs totaling $9,287.15 (all the costs claimed except for the cost of lunches totaling $62.65) as costs reasonably necessary to defend the claims asserted in the underlying case.” The undersigned has examined White Rock’s Exhibits 12A through 12G, which constitute the universe of taxable costs sought, and the total of the costs is $9,287. There is no cost of lunches included within Exhibits 12A through 12G. All of the costs identified in Exhibits 12A through 12G are taxable costs or incidental administrative costs directly associated with the case, and therefore, are recoverable under section 552.40.
Findings Of Fact On September 16, 1977, Respondent issued a Notice of Proposed Assessment of tax, penalties, and interest under Chapter 212, Florida Statutes, against Concrete Coring Company, Inc. "and/or" Concrete Cutting Tools Co., both of 1938-A Tigertail Boulevard, Dania, Florida, in the total amount of $33,586.53. At the hearing, a revised Proposed Assessment, dated March 29, 1979, in the amount of $35,248.80 was submitted. The revised assessment did not involve a change as to taxable transactions covered under the previous assessment, but reflected correction of erroneous interest and penalty calculations, and addition of interest charges from the date of the original assessment notice to March 29, 1979. The proposed assessment resulted from an audit of Petitioners' books for the period September 1, 1974 through August 31, 1977, conducted by George J. Petruff, Respondent's tax examiner, Fort Lauderdale area office. The audit was conducted in accordance with standard departmental procedures, and was approved by Keith E. Fowler acting group supervisor of the Fort Lauderdale area office who issued the proposed assessment. The official files of Respondent concerning the assessment include summary recapitulations of taxable transactions, extracts from journal entries of the books of Concrete Coring Company, Inc. (hereinafter "Coring Company"), and the auditor's notes which were made routinely and retained as a part of the auditor's report. Although Petruff did not testify at the hearing, Fowler identified the documents as having been prepared by Petruff incident to his assigned duties. Although the audit consisted of reviewing the books of both corporations, they were found to be so intermingled as to cause Fowler to determine that the assessment should be directed against both firms. (Testimony of Fowler, Respondent's Exhibits 1- 2, 4) Larry W. McCoy is the principal of both Coring Company and Concrete Cutting Tools Company (hereinafter "Cutting Tools Company"). Coring Company is in the business of providing services in the form of concrete sawing, drilling, and flame cutting, for demolition purposes for contractors and governmental agencies on a, contractual basis. This includes such projects as removal of bridges or parts thereof, concrete sawing for demolition of buildings, and other such jobs which require a specialized knowledge of concrete removal. In carrying out these operations, Coring Company utilizes some seven trucks that have been modified and equipped by McCoy, and specialized equipment consisting of about 200 core drills, 20 wall saws, 20 slab saws, and 4 flame cutting tools. Each wall saw costs between ten and fifteen thousand dollars. Cutting Tools Company purchased the vehicles and equipment and paid state sales tax thereon at the time of purchase. These items are used by Coring Company employees to perform the service contracts under the supervision of McCoy. Title to the trucks and tools are held in the name of Cutting Tools Company, but maintenance, repair and insurance is accomplished by Coring Company. The two companies operate under a "Franchise and Management Agreement," dated March 23, 1974, which provides that Coring Company has the exclusive rights to the expertise and "know-how" of Cutting Tools Company in the State of Florida. It also states that Cutting Tools Company possesses "proprietary equipment" for which manuals and training information are provided to Coring Company. It further provides that Cutting Tools Company will provide Coring Company technical, instructive, and administrative assistance, management, guidance, marketing procedures, advertising, and training in product and equipment application, and will oversee Coring Company's operations to insure the safe and proper use and maintenance of equipment. For these services, the contract originally provided that Coring Company would pay Cutting Tools Company the sum of $10,000.00 per month, payable at the end of each calendar year, and a royalty equal to 20 percent of its gross revenues which would also be payable at the end of each calendar year. Coring Company places its name on the vehicles provided by Cutting Tools Company and the contract specifies that such identifying marks must be removed at the termination of the franchise agreement. (Testimony of McCoy, Petitioners' Exhibit 1) In practice, McCoy, as the representative of Cutting Tools Company, trains Coring Company's employees in the use of the specialized equipment and supervises the operations undertaken incident to Coring Company's contracts. The gross income derived from such contracts has averaged between $300,000 to $500,000 per year during the audit period. Coring Company has exclusive use of the trucks and equipment under the franchise agreement and utilizes the same until their useful life has been expended. McCoy testified at the hearing that Cutting Tools Company does not rent or lease the trucks to Caring Company and that their use by the latter firm is simply incidental to the franchise fee paid for, his expertise and technical knowledge of concrete demolition. However, the payments specified in the franchise agreement are reflected on the books of Petitioners as truck and equipment lease expense. During the audit period, Coring Company was registered with Respondent as a dealer in the concrete core drilling business, but Cutting Tools was not so registered until subsequent to the audit period when it obtained a sales tax number for the business of renting tangible personal property. (Testimony of McCoy, Fowler, Petitioners' Exhibits 1-2, Respondent's Exhibit 1, 3)
Recommendation That the revised Notice of Proposed Assessment of Tax, Penalties and Interest under Chapter 212, Florida Statutes, dated March 29, 1979, be asserted against Petitioners pursuant to applicable law. DONE and ENTERED this 27th day of April, 1979, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Kenneth Sandler, Esquire 125 North 46th Avenue Hollywood, Florida 33021 David Miller, Esquire Assistant Attorney General Department of Legal Affairs The Capitol Tallahassee, Florida 32301
The Issue The issue is whether Petitioner is liable for a penalty for failure to maintain workers’ compensation insurance in violation of relevant provisions in Chapter 440, Florida Statutes (2007).1
Findings Of Fact Respondent is the state agency responsible for enforcing the statutory requirement that employers secure the payment of workers’ compensation for the benefit of their employees. § 440.107. Petitioner is a limited liability company domiciled in Florida and engaged in the sale of stone countertops. The disputed issues of fact arise from a single, integrated transaction involving “one and the same business” within the meaning of Subsection 440.10(1)(b). The “business” includes a contractor, a wholesaler, and two subcontractors, one of which is Petitioner. The integrated transaction is between the business and a homeowner. The contractor is identified in the record as Manasota Land Development (Manasota). The homeowner owns a residence on Agate Road in Port Charlotte, Florida (the homeowner). The contractor referred the homeowner to Petitioner for the purpose of selecting granite countertops. Petitioner’s representative visited the residence, took measurements, and received the order for granite from the homeowner. Petitioner placed the order with the wholesaler, the name of which is not material to this proceeding. The wholesaler delivered granite to a fabricator and installer designated by Petitioner and identified in the record as Granite Exclusive (the installer). The installer fabricated the countertops and installed them at the residence. Petitioner visited the residence to ensure customer satisfaction, and Petitioner paid the wholesaler and installer from funds provided by Manasota. Petitioner did not collect payment from the homeowner. Rather, Petitioner agreed with Manasota to a total price of $7,141.00. Petitioner billed Manasota for $3,570.00, an amount equal to approximately one-half of the total agreed price, on May 21, 2008, inferentially when the homeowner placed the order with Petitioner. Manasota paid Petitioner the 50 percent deposit. Petitioner billed Manasota for the balance due, in the amount of $3,571.00, on July 22, 2008, when the work was completed to the satisfaction of the homeowner, and Manasota paid the balance due. Petitioner was a sales agent, order processor, and a collection and payment processor for Manasota. Petitioner paid the wholesaler and installer from funds provided by Manasota. The fact-finder draws a reasonable inference from the evidence that Manasota collected a sum from the homeowner that was equal to or greater than the price Manasota paid to Petitioner. Petitioner and the installer are subcontractors of Manasota. Petitioner had no supervisory control over the installer. Respondent’s claim that a written or oral contract existed between Petitioner and the wholesaler and installer is not supported by clear and convincing evidence. It is undisputed that neither the installer nor Petitioner have workers’ compensation insurance, and the two subcontractors are, by operation of Subsection 440.10(1)(b), the employees of Manasota in “one and the same business.” Manasota is responsible for providing workers’ compensation coverage by operation of the statute. Petitioner mistakenly believed, in goof faith, that it was exempt from the requirements of Chapter 440. A company officer of Petitioner obtained an exemption certificate and, reasonably, concluded that the exemption was for Petitioner and both of Petitioner’s officers or employees. Such an exemption was the officer’s stated purpose when she entered the local state office responsible for issuing exemption certificates. The state employee represented that the exemption certificate actually issued achieved the officer’s stated purpose. The express terms of the exemption certificate provide that the exemption is for the person “and” company named in the certificate. However, Subsection 440.05 makes clear that an exemption covers only the company officer named in the certificate and that each of the two officers must be named in the certificate or that each officer must obtain a separate certificate. Petitioner did not engage in the business of fabricating or installing the stone countertop. Petitioner made a sale of the granite countertop and placed an order with a wholesaler. The wholesaler shipped the countertop to a the installer designated by Petitioner based on proximity to the project site. The fabricator installed the countertop. Petitioner did not supervise the fabrication or installation of the countertop. The fact-finder has considered and weighed conflicts in the evidence pertaining to the issue of whether Petitioner engaged in the business of fabricating and installing the stone countertop and has resolved any evidential conflicts in favor of Petitioner. The testimony of Petitioner’s witness, describing the nature and scope of Petitioner’s business, is consistent with Article 5 in Petitioner’s Articles of Incorporation which states: The general purpose for which the Company is organized is to engage in the business of natural stone countertop sales. . . . On June 3, 2008, Respondent’s investigator, conducted a compliance check at 8206 Agate, South Gulf Cove, Florida, to verify compliance with the workers’ compensation statutes. At the worksite, Respondent’s investigator observed three men installing a stone countertop for the installer. Installation of stone countertops is part of the construction industry and is assigned Class Code 5348 in the Scopes Manual, published by the National Council on Compensation Insurance and adopted in Florida Administrative Code Rule 69L-6.021. The investigator interviewed the three men and requested proof of compliance with the workers’ compensation law. One of the three men, neither furnished proof of an election to be exempt from workers’ compensation nor showed that he had secured workers’ compensation coverage. Utilizing the Department of Financial Services’ Coverage and Compliance Automated System (CCAS), the investigator was unable to determine that the employee of the installer was exempt from the requirements of the workers’ compensation law or that Petitioner had secured the payment of workers’ compensation. On June 4, 2008, the investigator issued a Stop-Work Order and Order of Penalty Assessment against Petitioner for failure to meet the requirements of Chapter 440. Respondent ordered Petitioner to cease all business operations and assessed a $1,000.00 penalty against Petitioner pursuant to Subsection 440.107(7)(d). On June 4, 2008, the investigator issued a Division of Workers’ Compensation Request for Production of Business Records for Penalty Assessment Calculation. Petitioner complied with the Request and provided the required records. Based on Petitioner’s business records, the investigator issued an Amended Order of Penalty Assessment on June 11, 2008, in the amount of $1,218.52. Mr. Thomas Harvey, a company officer of Petitioner, did not posses an election to be exempt from workers’ compensation. Ms. Leslie Lockett, the other company officer had applied for and obtained an exemption from workers’ compensation coverage. Ms. Lockett’s exemption from workers’ compensation lists the scope of business or trade as countertops, pursuant to instructions from the agency employee who issued the certificate. Ms. Lockett’s exemption from workers’ compensation is a construction industry exemption. Ms. Lockett applied for a Notice of Election to be Exempt as a member of a limited liability company in the construction industry pursuant to the instructions previously described. In the transaction at issue in this proceeding, Petitioner collected payment for materials and installation of a stone countertop from Manasota. Petitioner did not collect payment from the homeowner and had no control or authority over either the wholesaler or the installer.
Recommendation Based on the Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent issue a final order dismissing the Stop-Work Order and Amended Order of Penalty Assessment against Petitioner and Mr. Harvey. DONE AND ENTERED this 24th day of October, 2008, in Tallahassee, Leon County, Florida. S DANIEL MANRY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of October, 2008.
