The Issue Whether Respondent committed the violations alleged in the Administrative Complaint? him? If so, what disciplinary action should be taken against
Findings Of Fact Respondent is now, and has been since September 23, 1991, a Florida-licensed real estate salesperson (holding license number 0579778). On September 30, 1993, his license became "involuntary inactive." His license was reactivated effective November 22, 1994, and remained active through September 30, 1995. Respondent's license is currently in "involuntary inactive" status. In January of 1994, Respondent was hired to (and thereafter did work) as a real estate salesperson for 4% Realty, Inc. (4%). The decision to hire Respondent was made by Frank Eckert, 4%'s broker. At no time did Respondent advise Eckert that he (Respondent) did not have an active real estate salesperson's license. On January 26, 1997, and January 27, 1997, Respondent provided $500.00 to 4% (in the form of two checks made out to 4%, one, dated January 26, 1994, in the amount $300.00 and the other, dated January 27, 1994, in the amount of $200.00). The $500.00 represented a deposit made by Respondent in connection with a proposed real estate transaction involving Respondent (as the buyer) and Mark Solowitz (as the seller). By letter dated March 3, 1994, Respondent notified Solowitz that, as of January 26, 1994, there was “on deposit in 4% Realty, Inc., Escrow account a total sum of $500.” The real estate transaction between Respondent and Solowitz was never finalized. After the transaction failed to close, Eckert returned Respondent’s $500.00 deposit to Respondent. On or about October 12, 1994, Respondent applied and interviewed for a salesperson position in the Weston office of Prudential Florida Realty (Prudential). The interview was conducted by Dorothy McCullough, the branch manager of Prudential's Weston office. Respondent made certain statements during the interview with which McCullough was "not comfortable." At the conclusion of the interview, McCullough told Respondent that she would "get back to him" and "let him know" of her decision. At no time did McCullough hire Respondent or authorize him to use Prudential's forms or stationary or to act as an agent for Prudential. On or about October 13, 1994, Respondent submitted to First Atlantic Realty (First Atlantic), on behalf of prospective tenants, an offer to lease property (located at 3350 Ivy Way in Miramar) listed by First Atlantic. Respondent purported to be acting as a representative of Prudential. When McCullough discovered what Respondent had done, she telephoned him to make sure that he understood that he had not been, nor would he be, hired by her to work for Prudential. Subsequently, First Atlantic's broker, Roger Herman, learned that the prospective tenants on whose behalf Respondent had submitted the offer had already moved into the rental property notwithstanding that their offer (which was "extremely weak") had not been accepted.3 Herman thereupon went to the rental property "to find out what was going on." He attempted to communicate with the prospective tenants, but was unsuccessful because they spoke ”very little English." He then telephoned the police. Upon arriving on the scene, the police spoke with the prospective tenants and persuaded them to vacate the premises. On or about October 24, 1994, Respondent submitted to First Atlantic, on behalf of the same prospective tenants, another offer to lease the property at 3350 Ivy Way. On this occasion, however, Respondent was acting as a salesperson in the employ of 4%. Herman responded to this second offer by contacting the Department by telephone and discussing the situation with a Department representative. During the discussion, Herman was advised by the Department representative that Respondent did not possess an active salesperson's license. Herman then telephoned Eckert and informed him of Respondent's licensure status. After speaking with Herman, Eckert telephoned the Department and received confirmation that Respondent did not have an active salesperson's license. Eckert then contacted Respondent and advised him that his employment with 4% was terminated.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission issue a final order finding Respondent guilty of the violations described in Conclusion of Law 41 of this Recommended Order and revoking his real estate salesperson's license for having committed said violations.DONE AND ENTERED this 28th day of April, 1997, in Tallahassee, Florida. STUART M. LERNER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 28th day of April 1997.
Findings Of Fact The Respondent Marinatown Realty, Inc., is a corporate real estate broker, holding license number 0208680 and located at 3440 Marinatown Lane, Northwest, North Fort Myers, Florida. Marinatown Realty is a wholly owned subsidiary of Seago Group, Inc., a publicly held land development and rental corporation whose president is Thomas P. Hoolihan. In late 1977, Hoolihan met L. E. Hutchinson, the complainant in this case, through another broker for whom Hutchinson at the time was employed. In December, 1977, Hoolihan and Hutchinson discussed the marketing of two condominium projects being developed by Hoolihan and reached an oral agreement whereby Hutchinson would be paid $18,000 in salary with a 1 1/2 percent commission on all sales. When the condominium units were completed and mostly sold, the parties' employment agreement was revised in late December, 1979. Under the new agreement, Hutchinson was to receive $30,000 a year salary, commissions on the remaining condominium units that had not yet closed and any commissions on outside property listings neither owned nor controlled by Seago. In return for the $30,000 guarantee, Hutchinson was to forego commissions on future properties owned or controlled by Seago Group, Inc. During the period from 1977-1978 when Hutchinson was receiving $18,000 plus a 1 1/2 percent commission, sales were handled through Lee Hutchinson Realty, Inc., which held license number 0182945. In early 1979, Marinatown Realty was incorporated to market Seago's real estate inventory, to identify and list outside properties and to act as a management agent for purposes of renting condominium units previously sold in recent projects. When Marinatown Realty was formed, the complainant became its active broker. While employed as the broker for Marinatown and receiving $30,000 a year as a salaried employee, Hutchinson held two other broker's licenses, one as L. E. Hutchinson Realty, Inc., and another as L. E. Hutchinson. In January, 1980, Hoolihan agreed to pay a $15,000 bonus to Hutchinson in lieu of a salary increase. Since at that time sales were minimal, Hoolihan decided to pay the bonus in installments as sales occurred. Because Hutchinson left in May, 1980, he received only $10,000 of the bonus which represented moneys previously paid. On April 23, 1980, Hutchinson and Chuck Bundschu, a licensed real estate broker, negotiated and obtained a sales contract between Hancock Harbor Properties, Ltd., a wholly owned subsidiary of Seago Group, Inc., seller, and Frank Hoffer, buyer and licensed real estate broker, in which Hoffer offered to purchase approximately 3.16 acres of unimproved acreage for $500,000. Thomas P. Hoolihan, general partner of Hancock Harbor, executed the contract on behalf of the partnership. Prior to presenting the contract to Hoolihan, Bundschu, Hoffer and Hutchinson decided on a 30 percent, 40 percent 30 percent respective co- brokerage split on the $50,000 commission due on the sale of the Hancock Harbor Property. The co-brokerage fee split was typed on the bottom of the contract submitted to Hoolihan and was signed by the three brokers. The commission due to Hutchinson was made payable to L. E. Hutchinson Realty, Inc. On April 25, 1980, the contract with the original co-brokerage split was presented to Hoolihan who refused to agree to its co-brokerage split provision. In the presence of Hutchinson, Hoolihan informed Bundschu and Hoffer that he would not pay a commission to Hutchinson because he was a salaried employee of the Seago Group and not entitled to a commission on the sale of this property. Accordingly, the co-brokerage fee provision of the executed contract was never signed by the seller, Thomas P. Hoolihan. Instead, on April 25, 1980, Bundschu, Hoffer and Hoolihan agreed to a split of $20,000 to Hoffer and $15,000 to Bundschu in lieu of the split specified on the bottom of the contract. At the closing on July 18, 1980, which was held at Coastland Title Company, a closing statement was prepared which shows that real estate commissions were disbursed to Chuck Bundschu Realty, Inc. ($15,000), Marinatown Realty, Inc., ($15,000) and Hoffer's firm, Landco, Inc., ($20,000). The checks were written and disbursed following a conversation between an official of Coastland Title Company and Hoolihan in which Hoolihan informed the official that Hutchinson was a Seago employee and he would not agree to pay a $15,000 commission to him under such circumstances. On July 18, 1980, a check for $15,000 was issued by Coastland Title Company to Marinatown Realty, Inc. The $15,000 represented Hutchinson's share of the co-brokerage agreement. When received on July 18, 1980, by Billie Robinette, the broker for Marinatown Realty, the check was signed over by her to Seago Group, Inc., since in her opinion it did not represent commissions earned by Marinatown Realty. The oral agreement between Hutchinson and Hoolihan was to terminate at the end of April, 1980, or approximately five days after the Hoffer contract was presented. Hoolihan offered to renew the contract without a provision for a guaranteed salary because Marinatown Realty had been consistently losing money since its incorporation. On May 6, 1980, Hoolihan received a letter of resignation from Hutchinson and concluded that his offer had been rejected. In early May, 1980, Hoolihan received a call from Ms. Robinette, who had been employed as Hutchinson's secretary, regarding filling the open brokerage position at Marinatown Realty, Inc. Hoolihan discovered from Ms. Robinette that Hutchinson had paid himself 50 percent of the commissions due Marinatown Realty, Inc., for the management of condominium rentals. After examining the check stubs from Marinatown's bank account, Hoolihan took personal possession of all the books and records of the company and had the office locks changed. When he examined the books and records of the realty company, Hoolihan realized that his assumption that Hutchinson Realty, Inc., became inactive when Marinatown Realty, Inc. was formed in January, 1979, was erroneous and that Hutchinson had operated his own realty company, L. E. Hutchinson Realty, Inc., while employed by Marinatown Realty, Inc. Although he held multiple licenses, Hutchinson denied that a conflict ever existed between his duties to Marinatown Realty, Inc., and his own company, L. E. Hutchinson Realty, Inc. When questioned during the final hearing regarding how he decided where to list properties while he was the broker for both companies, the following exchange occurred between Hutchinson and counsel for Marinatown Realty, Inc.: Q Let me ask you, Mr. Hutchinson, how would it be decided when you were to go out and list property as to whether or not that property would be listed under Marinatown Realty or L. E. Hutchinson Realty, Inc.? Who would make that determination? A I would. Q Solely on your own? A I had no contract with anyone. I had nothing in writing to direct me where to place any business. Q So this would be solely your decision as to how you would list the property? Either Marinatown Realty or L. E. Hutchinson Realty? A If I secured the listing it was my dis- cretion as to where I listed the real estate. I had the choice of one of two companies. * * * Q If you were to list property in my hypo- thetical with Marinatown Realty, is it not a fact that they would receive, and being Marinatown Realty, would receive one half of the commission and you, as the broker, would receive the other half? A That was what I did. Q So it would certainly be beneficial to Seago to have you list as much property as you could with Marinatown Realty because they, in fact, owned the stock with Marinatown Realty, is that not true? A Yes, sir. Q When you would list property with L. E. Hutchinson Realty, Inc., would you do this with the full knowledge, consent and permission of Marinatown Realty, Inc.? A Yes, sir. Q How would you say that you gave full consent when you just testified that it was solely up to you as to how you would list property? A If I solely decided, I give my consent. I don't have anybody else to answer to. (T. pp. 108-110) During the period that Hutchinson was a broker for Marinatown Realty and L. E. Hutchinson Realty, Hutchinson believed his primary duty was toward his own company as illustrated by the following exchange between counsel for Respondent and the complainant: Q It's a fair statement to say that you, as a broker for Marinatown Realty, Inc. didn't make a whole lot of money for Marinatown Realty, did you? A I didn't run the P & L statement. Q I'm asking you as being the broker. You didn't make a lot of money for Marinatown Realty, Inc., did you? A I made as much money for them as I did for the responsibility. Q Well, did L. E. Hutchinson Realty, Inc. make a lot of money during that period of time? MR. FERNANDEZ: Objection as to relevancy, this whole line of questioning. MR. NEEL: Your Honor, it isn't. It's germaine. HEARING OFFICER: Objection overruled. THE WITNESS: I'm sorry, the question? Q Did L. E. Hutchinson Realty, Inc. make a lot of money during this period of time? A That's relative. Q In comparison to what money Marinatown Realty made? A Yes, sir, because L. E. Hutchinson Realty had a thirty thousand retainer that was coming in up until April 30th. Q From Seago? A Certainly. Q So L. E. Hutchinson Realty, Inc. made a lot more money than Marinatown Realty, Inc., didn't they? A That's the way its supposed to work. Q And, again, it was at your sole dis- cretion as to how you would list the properties; under which principal. A Yes, but I asked for a specific con- tract and never got it. (T. pp. 124-125) The Administrative Complaint in this case was filed on July 22, 1981. The preliminary investigative report compiled by Robert Corno, DPR Investigator, was filed on September 24, 1981 and the final investigative report was filed on September 30, 1981. The following is a synopsis of the investigator's findings and recommendation: That the COMPLAINANT [Hutchinson] worked for the SUBJECT [Hoolihan] and their contractual agreement was verbal. COMPLAINANT was paid on a salary/commission basis by companies of which SUBJECT is Chief Officer. That the COMPLAINANT filed civil action suit against SUBJECT in this case and it was dismissed with prejudice. That prior investigation by the DPR re- commended that no action be taken against the SUBJECT in this case. That two weeks after this investigation was undertaken, an Administrative Com- plaint was being filed by the DPR against the SUBJECT. That the existing BROKER for MARINATOWN REALTY, INC. was not involved in this case, and that since the time of the above referenced transaction, the SUBJECT has acquired his BROKER'S license #020462 which had no effect in this case. That conflicting statements by inter- viewers, namely former and present em- ployees and other agents involved in this case revealed that there is a reasonable doubt for probable cause against the SUBJECT. (Respondent's Exhibit 1) As noted by Investigator Corno, this was the second time Marinatown Realty had been investigated in relation to this case. In both instances a recommendation that no action be taken against the Respondent was apparently made. At the final hearing on December 1, 1981, counsel for the Department saw the complete investigative report, including the investigator's recommendation of a lack of probable cause, for the first time. Count II of the Administrative Complaint alleges that Hutchinson is entitled to compensation for services rendered on the following sales contracts: Seago Group, Inc. as seller, to Michael T. and Judith Marchiando as buyers, Seago Group, Inc. as seller, to John E. and Charlotte A. Ferguson as buyers, and Seago Group, Inc. as sellers, to Kenneth J. Dawson as buyer. In regard to the first transaction, the Marchiandos were personal friends of the son-in-law of Seago's major shareholder, Mr. R. Berti. Hutchinson's role in this transaction was limited to preparing the contract and mailing it to the Marchiandos for signature. Hutchinson had no part in selling this property and never met the Marchiandos. The sale of the Ferguson's arose in a manner similar to the Marchiandos. Mr. Ferguson is the manager of a Detroit company owned by Mr. Berti. Similarly, Mr. Dawson works for Mr. Berti in Detroit as an accountant. These sales were made by Mr. Berti and Hutchinson furnished administrative assistance by completing the contracts and sending them to these individuals for signature. Under the terms of the agreement between Hoolihan and Hutchinson, a commission was not due on these properties to Hutchinson since these were not outside listings and his agreement with Hoolihan did not contemplate that commissions be paid in such situations.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Administrative Complaint filed against Marinatown Realty, Inc. be dismissed. DONE and ORDERED this 28th day of April, 1982, in Tallahassee, Florida. SHARYN L. SMITH Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of April, 1982. COPIES FURNISHED: Xavier J. Fernandez, Esquire NUCKOLLS JOHNSON & FERNANDEZ Suite 10, 2710 Cleveland Avenue Fort Myers, Florida 33901 James A. Neel, Esquire 3440 Marinatown Lane, N.W. Fort Myers, Florida 33903 Frederick H. Wilsen, Esquire Assistant General Counsel Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Samuel R. Shorstein, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301 Carlos B. Stafford Executive Director Florida Real Estate Commission 400 West Robinson Street Post Office Box 1900 Orlando, Florida 32802
The Issue Respondents are charged with misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device, culpable negligence, or breach of trust in any business transaction in violation of Section 475.25(1)(b), Florida Statutes; failure to account or deliver funds in violation of Section 475.25(1)(d), Florida Statutes; and failure to maintain trust funds in the real estate brokerage escrow bank account or some other proper depository until disbursement is properly authorized, in violation of Section 475.25(1)(k), Florida Statutes, as more specifically set out in the following Conclusions of Law.
Findings Of Fact Petitioner is the state agency charged with the responsibility and duty to prosecute administrative complaints, pursuant to Section 20.165 and Chapters 120, 455, and 475, Florida Statutes. At all times material, Respondent Mary Lawhon was a licensed Florida real estate broker, issued license numbers 607847 and 3028674 in accordance with Chapter 475, Florida Statutes. Respondent Shell Point Realty, Inc., is, and at all times material was, a corporation registered as a Florida real estate broker having been issued license number 1005003 in accordance with Chapter 475, Florida Statutes. At all times material, Respondent Mary Lawhon was licensed and operating as qualifying broker and officer of Respondent Shell Point Realty, Inc. Neither Respondent has previously been prosecuted for license violations, although an Agency investigator's administrative fine of $100.00 for a minor technical violation was imposed several years ago. Between 1996 and 2002, Respondents were paid real estate commissions for the purchase or sale of several Wakulla County properties by Gerd Petrik, or his business, Stone Real Estate Holdings, Inc. For each of these transactions, there was a contract, whereby Respondents' real estate brokerage commission was based on the price of each property as disclosed before sale in the written listing agreement with the seller(s). Mr. Petrik is a foreign national residing in the United States on an investment visa. He lives in Sarasota, Florida. He "owns" several corporations,2/ and, through them, he owns at least 40 properties in the Panhandle of Florida, including a golf course and six rental houses in Wakulla County. One of these rental houses is located at 111 Razorback Road in Crawfordville. Mr. Petrik, or a corporation in which he is majority stockholder, owner-financed, by mortgage, one of the buildings from which Ms. Lawhon conducts Shell Point Realty, Inc.'s business. As an outgrowth of their real estate sales transactions, Mr. Petrik came to respect and value Ms. Lawhon's real estate skills and business acumen. He also appreciated her position and prestige in the community as the former Wakulla County Administrator. Until the incidents giving rise to this case occurred, Mr. Petrik found Ms. Lawhon to be professional and competent in real estate matters and honest and truthful. Mr. Petrik admits that he has lost no money as a result of the incidents giving rise to this license disciplinary proceeding. There has never been a written contract imposing any duty on Respondents to Mr. Petrik with regard to his six rental houses in Wakulla County, or with regard to the 111 Razorback Road property in particular. Having reconciled the witnesses' respective testimonies to the degree possible, and having assessed their respective versions upon credibility factors, it is found that Respondents were never retained or expected by Mr. Petrik to rent, lease, or manage any of his six rental houses in Wakulla County, including the 111 Razorback Road property. Respondents also did not advertise any rental properties, solicit any renters, put up any "for rent" signs, or charge any real estate or management fees to Mr. Petrik or his businesses in connection with the rentals of Mr. Petrik's properties. However, with an eye to promoting further profitable real estate sales dealings with Mr. Petrik, Ms. Lawhon gratuitously facilitated Mr. Petrik's renting his Wakulla County houses. To this end, she regularly communicated by telephone and fax with Mr. Petrik's business manager, Wendy Freed, concerning showing the properties, rent to be charged, and creation or signing of leases. At all times material, Wendy Freed worked in Mr. Petrik's office in Sarasota, as business manager for Stone Management Inc., one of Mr. Petrik's corporations. Stone Management, Inc., owns Stone Real Estate Holdings, Inc. Ms. Freed believed that Stone Real Estate Holdings, Inc., owned 111 Razorback Road, Crawfordville. Apparently no one involved in this case knew that in October 2001, 111 Razorback Road was owned by Newhouse, Inc.3/ The evidence is not clear who or what entity owned the property in March 2002. Regardless of which entity actually owned any of the rental houses, Ms. Freed, Ms. Lawhon, and Mr. Petrik all believed Ms. Freed had Mr. Petrik's complete authority to handle the rentals and to manage everything in connection with the six Wakulla County rental houses, including 111 Razorback Road. Ms. Freed possesses no real estate or other professional licenses. Her entire training for management or leasing of real estate has been "on the job" training with Mr. Petrik. As of October 2001, she possessed only about a year and a half of such training. She keeps track of multiple rentals and other property management factors without any modern property management software. She uses only an Excel spreadsheet. Despite Ms. Freed's testimony to the contrary, it is found that Ms. Lawhon is credible that Ms. Lawhon only collected rent money for Mr. Petrik, or for any of Mr. Petrik's businesses, upon Ms. Freed's specific request, until the incidents giving rise to this case; that all leases for Mr. Petrik's rental properties were usually prepared by Ms. Freed, although on occasion, Ms. Lawhon had prepared a lease for Ms. Freed to use, based on the Tallahassee Board of Realtors' Standard Form; and that usually, after one of Mr. Petrik's houses had been leased, Ms. Freed dealt directly with the lessee, unless she dealt with the lessee through Mr. or Mrs. Alward. At all times material, Kay Alward and Chris Alward, husband and wife, were employed by Mr. Petrik. They were not sure whether they were paid through Stone Management, Stone Real Estate Holdings, Inc., or Stone Management Enterprises. Mrs. Alward had been Mr. Petrik's housekeeper, and Mr. Alward had been his gardener, in Sarasota. Mr. Alward had also personally invested in Wakulla County real estate. For awhile, the Alwards assisted Ms. Freed in managing Mr. Petrik's properties in Wakulla County, by traveling to and from Wakulla County. Ultimately, they moved to Wakulla County to live and manage his properties. During the material period of time, they employed a man named "Greg" to steam clean decks, fix toilets, and be a general handyman for Mr. Petrick's Wakulla County rental properties. Before returning to Sarasota on one occasion, Mr. Alward left with Ms. Lawhon a key for 111 Razorback Road. She understood from him that workmen might need the key to get into the house for repairs and cleaning. Sometime thereafter, on or about October 12, 2001, Lorra Shepard, a local Certified Public Accountant, walked into Respondents' real estate office, because a friend of hers worked there, and asked if they had any rentals. She was shown the 111 Razorback Road property. She asked Ms. Lawhon if she could rent it, and Ms. Lawhon told her the lessor wanted $675.00 per month. Ms. Shepard asked if they could come down on the price. Ms. Lawhon testified that she telephoned Ms. Freed on October 12, 2001, and asked Ms. Freed to lower the rent for Ms. Shepard; that Ms. Freed agreed to lower the rent to $635.00 per month and agreed to draw the lease; that she, Ms. Lawhon, relayed this information to Ms. Shepard; that Ms. Shepard agreed to rent the house at that price; and that Ms. Lawhon then telephoned Ms. Freed again with this information and finally faxed written information about Ms. Shepard to Ms. Freed, so that Ms. Freed could draft the lease and collect subsequent rents. This testimony is credible.4/ Ms. Lawhon and Ms. Shepard concur that Ms. Shepard moved into 111 Razorback Road on October 15, 2001, and that day, Ms. Lawhon accepted a $450.00 cash deposit from Ms. Shepard and provided Ms. Shepard with a signed receipt, setting out the monthly rent of $635.00 per month, and signing the receipt with Ms. Lawhon's own name. Ms. Shepard is clear that at no time did Ms. Lawhon tell her 111 Razorback Road was Ms. Lawhon's house or suggest that Ms. Shepard hide her occupancy. Rather, Ms. Shepard confirms Ms. Lawhon's testimony that Ms. Lawhon told her that the lessor would be sending a lease and that the lessor was Mr. Petrik. Ms. Shepard's testimony also suggests that in October 2001, she thought Ms. Lawhon was saying that Ms. Lawhon would deliver the lease and that when Ms. Shepard signed the lease, she and Ms. Lawhon, together, would work out whether rent would be paid on the 15th or 31st of each month. Even if it were credible that Ms. Freed had told Ms. Lawhon to retain the $450.00 cash deposit, and this portion of Ms. Lawhon's testimony does not ring entirely true, there is no evidence that Ms. Lawhon timely placed the $450.00 cash in an escrow or trust account. It also was not remitted directly to Mr. Petrik or Ms. Freed in October 2001. On the other hand, there is no evidence that it was deposited into any account in Respondents' name(s). It is unclear from Ms. Lawhon's hearing testimony what, exactly, happened to the $450.00 cash deposit, but she admitted to the Agency investigator in June 2002 that she had put it in a file and forgotten about it, and this explanation is accepted. At no time material did Ms. Freed or Ms. Lawhon prepare a lease for 111 Razorback Road. At no time material did either of them send or deliver a lease to Ms. Shepard. Ms. Shepard testified credibly that several times between October 2001 and March 2002, Ms. Lawhon told Ms. Shepard that she, Ms. Lawhon, still had no lease and would call the lessor again. Ms. Lawhon did not address this aspect of Ms. Shepard's testimony in her own testimony. Ms. Lawhon testified that she thought Ms. Freed would deal directly with Ms. Shepard about all aspects of the lease and collecting rent. She also admitted that she had never discussed 111 Razorback Road with Ms. Freed in any of their frequent telephone conversations between October 15, 2001 and March 2002. Upon this evidence and Finding of Fact 24, it is found, contrary to Ms. Lawhon's hearing testimony, that Ms. Lawhon was, in fact, expecting to receive a lease from Ms. Freed and planned to then deliver that lease to Ms. Shepard for execution, but Ms. Lawhon never followed up on Ms. Shepard's request for a lease. Having no lease to guide her, Ms. Shepard did not make out checks for rent in thirty-day increments, beginning in October or November 2001. Instead, she contemporaneously made out a check dated December 21, 2001, for $1,905.00, to "Petrick" for the rent. She contemporaneously made out a check dated December 26, 2001, for $317.50, to "Petrick" for the rent. She contemporaneously made out a check dated February 7, 2002, for $952.00, to "Petrick" for the rent. She expected Ms. Lawhon to pick up these checks, but no one picked them up. Accordingly, Ms. Shepard just left these three checks, totaling $3,174.50, in her office desk drawer and went about her business until March 26, 2002. Mrs. Alward ran some advertisements for Mr. Petrik's rental houses in December 2001. Ms. Lawhon testified that she told Mrs. Alward in December 2001 not to advertise 111 Razorback Road because it was rented. Mrs. Alward was not asked to confirm or deny that conversation occurred, and Mrs. Alward's testimony at hearing does not specifically rule out that she advertised 111 Razorback Road. However, Mr. Alward's deposition and the testimony of Mr. Weltman reveal that in January 2002, the Alwards were managing all rental arrangements by referral to Ms. Freed. In January or February 2002, a maintenance person steam-cleaned the deck at 111 Razorback Road. The maintenance person was never seen by Ms. Shepard, but the maintenance person clearly knew someone was occupying the house because s/he left a note for Ms. Shepard to confine her dogs so the steam cleaning could be done the next day. Ms. Shepard assumed the steam cleaning was done at Ms. Lawhon's direction, but she did not contact Ms. Lawhon about it. Ms. Lawhon did not arrange this service and knew nothing about it. Based on the testimony of Ms. Freed, Mr. and Mrs. Alward, and Mr. Weltman, it is probable "Greg" did this steam cleaning at the Alwards' direction, but Ms. Freed takes no responsibility for it. Upon Findings of Fact 28-29, it is only reasonable to assume that the Alwards had notice that 111 Razorback Road was rented and occupied as of December 2001-January 2002, and their knowledge as of those dates can be imputed to Ms. Freed. On March 26, 2002, Ms. Shepard personally delivered to Ms. Lawhon the three rent checks she had previously written to "Petrick," on December 21, 2001, December 26, 2001, and February 7, 2002, totaling $3,174.50.5/ Ms. Shepard then returned to her office, and on March 29, 2002, she delivered to Ms. Lawhon a last check for $317.50, dated March 26, 2002, and payable to "Stone Real Estate Holdings." The undisputed evidence reveals that on March 29, 2002, Ms. Lawhon signed the first three checks as "Petrik" and deposited them under the stamped endorsement of "Shell Point Realty," into Shell Point Realty, Inc.'s, operating account. She did not deposit them into an escrow account for Mr. Petrik or into Respondents' trust account. The March 29, 2002, deposit complied with Agency rules, in that it was made "immediately" (within three business days or less) of Respondents' receipt of the funds. It did not comply with Agency rules in that it was not deposited in a trust, escrow, or other specifically designated account for Mr. Petrik's benefit. Mr. Petrik and Ms. Freed maintain that Ms. Lawhon was not authorized to endorse the checks with Mr. Petrik's name. The average daily balance of Respondents' operating account at the time Ms. Lawhon deposited Ms. Shepard's first three rent checks was over $54,000.00. There appears to be no financial motivation for Respondents to play fast and loose with the relatively minor amounts of money involved in this case. At hearing, Ms. Lawhon had several explanations for her handling Ms. Shepard's first three checks as she did: that she thought she had received permission for this procedure in a phone conversation with Ms. Freed on March 26, 2002; that Mr. Petrik had allowed herself or Mr. Alward to sign closing and disclosure documents (but not negotiable instruments or checks) for him in the past, as a matter of convenience; and that she was afraid because Ms. Shepard's checks were stale and incorrectly made out (to "Petrick" instead of "Petrik," and not to "Stone Real Estate Holdings"), they also might not be any good. She testified that her thinking was that she should run Ms. Shepard's local checks through her own local bank to be sure they were valid. She maintained that she had intended to run the checks through Respondents' trust account but deposited them into the wrong account by accident. Although Respondents' telephone records show communication with Ms. Freed's telephone on March 26, 2002, it is noted that Ms. Lawhon's explanation that she had received permission from Ms. Freed that day was never put forth prior to her testimony at the disputed-fact hearing. (See Findings of Fact 44-45 and 51-52.) March 29, 2002, was a Friday. On Monday, April 1, 2002, Ms. Lawhon telephoned her bank and verified that Ms. Shepard's three checks had cleared. That same day, Ms. Lawhon used an overnight delivery service to send Ms. Freed Shell Point Realty, Inc.'s, check for $2,355.00, made out to "Stone Real Estate Holdings." The April 1, 2002, Shell Point Realty, Inc., check specified, on its memo line, that it covered "$635/mo. Jan. 02-April 15 + 450 dep." This amount would have been correct at $635 per month for only three months' rent (January-March 2002) plus a $450.00 deposit. However, it was the wrong amount, considering the 75-day period of October 15, 2001 to January 1, 2002. This check also was $819.50 short of the total amount of Ms. Shepard's first three checks, which Ms. Lawhon had received and negotiated in the names of Petrik/Shell Point Realty, Inc. Ms. Lawhon's testimony did not address when she sent Ms. Shepard's March 26, 2002, check for $317.50, which had been correctly made out to "Stone Real Estate Holdings," to Ms. Freed. Ms. Freed believed she had received this check a week after the April 1, 2002, mailing. However, because this fourth check, received by Ms. Lawhon on March 29, 2002, is also referenced on the memo line of the April 1, 2002, Shell Point Realty, Inc., check, it may be inferred that Ms. Shepard's last check also was sent to Ms. Freed in Ms. Lawhon's April 1, 2002, overnight package. Ms. Lawhon was overwrought on April 1, 2002. She had received a telephone call to come to Louisiana to care for her grandchildren because her daughter-in-law was terminally ill. The last thing she did before leaving Crawfordville, Florida, on that date was to calculate the rents, make out the Shell Point Realty, Inc., check, and send the two checks by overnight delivery to Ms. Freed. Except for returning for less than 24 hours covering part of the following Saturday and Sunday, April 6-7, 2002, to play piano in her church on Sunday, Ms. Lawhon did not return to Florida until Friday, April 12, 2002. April 12, 2002, was Ms. Lawhon's first day in the Shell Point Realty, Inc., office since April 1, 2002. That afternoon, she received a phone call from Mr. Petrik's attorney. She told him her reasons for signing Ms. Shepard's three stale checks as "Petrik" and depositing them. He said he did not think that Ms. Freed had received the whole amount owed by Ms. Shepard. Ms. Lawhon asked him to give her until Monday to recalculate and figure out what had happened. On Monday, April 14, 2002, Ms. Lawhon telephoned Mr. Petrik's attorney and admitted that she had miscalculated the rental amounts collected on March 26-29, 2002, and that she would be sending Mr. Petrik the balance owed. At the attorney's suggestion, she wrote a letter of apology to Mr. Petrik. Ms. Lawhon's April 15, 2002, letter to Mr. Petrik reads, in pertinent part: I hardly know where to begin except to say to you 'I offer my most humble apology concerning the checks from Lorra Shepard.' . . . Since the checks were so old, I signed the back and deposited three of them to make sure they would clear the bank. There was no intention to mislead any one [sic] or to take the money. I had sent the completed lease without her signature and the deposit to your office in December. I assumed you received the lease and would follow through with notification to Ms. Shepard about payment and signature of lease. Your office apparently did not receive my letter and I failed to follow up until I got a call from Wendy a few weeks ago telling me that your office had not received any rent payments. Since the checks were so old and I had signed closing papers, applications for permits, etc. for you in the past, I signed the checks and deposited them in the Shell Point Realty account. On the date that I found out that they had cleared, I ran by the office on my way out of town to write out the check to Stone Real Estate Holdings and figured the wrong amount. Enclosed is check # 3459 for the balance of the rent and Check # 3463 for the deposit . . . . (Emphasis supplied) The emphasized portions of her letter, concerning transmittal to Ms. Freed of the $450.00 deposit, contradict each other, and the information in Ms. Lawhon's letter about her sending a blank lease to Ms. Freed in Sarasota in October 2001, is contrary to Ms. Lawhon's testimony at the disputed-fact hearing and contrary to part of Ms. Freed's deposition testimony. It is further noted that Ms. Lawhon did not mention in this April 15, 2002, letter to Mr. Petrik that she had received permission from Ms. Freed in March 2002 to endorse and deposit the first three checks. It is undisputed that Ms. Lawhon mailed to Ms. Freed a Shell Point Realty, Inc., operating account check for $820.00, dated April 14, 2002, made out to "Stone Real Estate Holdings." This was intended to make up the difference as calculated from Ms. Shepard's first three checks. (See Finding of Fact 38.) It also is undisputed that on April 15, 2002, Ms. Lawhon mailed to Ms. Freed a Shell Point Realty, Inc., operating account check for $450.00, of the same date, made out to "Stone Real Estate Holdings." Apparently, this reflected the amount of the cash deposit Ms. Shepard had given Ms. Lawhon on October 15, 2001. Ms. Lawhon's explanation at the disputed-fact hearing for sending two checks on April 15, 2002, was that she had miscalculated again. With the last check, Respondents satisfied all of what was owed to Mr. Petrik and cleared any discrepancies in their professional accounts within 30 days, as required by Agency Rule. The Agency's June 2002 audit of Respondents' accounts for the material period of time found them to be substantially in compliance with all regulations and general bookkeeping standards for real estate personnel. Ms. Lawhon did not represent to the Agency investigator in June 2002 that she had been given permission by Ms. Freed on March 26, 2002, to sign three of Ms. Shepard's checks with Mr. Petrik's name, but otherwise, her admissions to the investigator are consistent with her explanation at the disputed-fact hearing that Mr. Petrik had allowed people to sign documents (not negotiable instruments or checks) for him in the past as a matter of convenience, and that she was afraid because Ms. Shepard's three checks were stale and incorrectly made out, they also might not be any good. (See Finding of Fact 36.) Telephone bills show there was communication between Respondents and Ms. Freed on March 26, 2002. However, due to what appears to be Ms. Lawhon's recent fabrication that she received oral permission from Ms. Freed on March 26, 2002, to endorse Mr. Petrik's name on Ms. Shepard's first three checks, the portion of her testimony claiming that Ms. Freed gave her permission to endorse those checks in Mr. Petrik's name is not credible. Ms. Lawhon's April 15, 2002, letter (see Finding of Fact 44) constitutes an admission, as well as a statement inconsistent with her testimony at the disputed-fact hearing, in that her letter stated that she did not realize that she had "failed to follow up" concerning the 111 Razorback Road rental until she received a phone call from Ms. Freed. It is significant that Ms. Lawhon's letter states Ms. Freed called Ms. Lawhon first. There is no direct evidence as to why Ms. Shepard chose March 26, 2002, to deliver her three stale checks to Ms. Lawhon or why she made the last check payable to "Stone Real Estate Holdings," the Petrik corporation with which Respondents had an on-going commission sales relationship, but it may be inferred therefrom that it was on March 26, 2002, that Ms. Freed inquired of Ms. Lawhon why she was not receiving rental checks and why she had no lease if the 111 Razorback Road property were occupied. Ms. Freed testified that Respondents failed to remit any of Mr. Petrik's funds due until Ms. Freed first contacted Ms. Lawhon and requested the rent proceeds, and that when contacted by Ms. Freed, Ms. Lawhon initially told Ms. Freed that she had placed Ms. Shepard in 111 Razorback Road in January 2002. The Agency suggests that this representation to Ms. Freed by Ms. Lawhon, together with Ms. Lawhon's remitting only $2,355.00 on April 1, 2002, with the January to March memo on that check, amounts to Respondents' intentional misrepresentation of the amount due Mr. Petrik. Ms. Freed also testified that she later discovered from Ms. Shepard that, in fact, Ms. Shepard had been in possession of 111 Razorback Road since October 2001, and, therefore, Ms. Freed realized that the total amount due Mr. Petrik was higher than the amount represented and remitted by Ms. Lawhon on April 1, 2002. On this basis, the Agency asserts that Respondents remitted the additional funds on April 15, 2002, only after Ms. Freed had confronted Ms. Lawhon concerning her misrepresentation. Unfortunately, Ms. Freed's version of events is not entirely credible for the following reasons: Ms. Freed testified that she knew 111 Razorback was vacant in October 2001, but did not know from October 2001 to March 2002 that it was occupied/rented. She also testified that during this period she made no effort to rent that house. This suggests that either she was not doing her job or she knew on some level in October 2001 that the property was already rented. Ms. Lawhon's notification to Mrs. Alward that it was rented in December 2001 is unrefuted, and Mr. Alward testified that approximately January 2002, he and his wife had notified Ms. Freed that someone was living in the house. Against all this, Ms. Freed testified that she had learned of the occupancy of 111 Razorback Road from the Alwards in March 2002 and from Ms. Lawhon. She further testified that when she first talked to Ms. Lawhon in March, Ms. Lawhon said she had previously sent Ms. Freed her own check and would have to determine if that check had cleared.6/ Finally, Ms. Shepard is very clear that when Ms. Freed contacted her, Ms. Freed did not dispute the $635.00 (as opposed to $675.00) per month rental amount.7/ While Ms. Freed's accepting the lesser amount is not absolute proof, it is, with all the other evidence, an indicator that she had previously approved that amount when Ms. Lawhon telephoned her in October 2001. Given the somewhat naïve and confused property management process in Sarasota, including Ms. Freed's ignorance that Newhouse, Inc. actually held title to the property, Ms. Freed's assessment of an intentional misrepresentation by Respondents is not persuasive. It is undisputed that Ms. Lawhon did not correct the discrepancy of $1,270.00 until April 15, 2002, after Mr. Petrik's lawyer (not Ms. Freed) contacted her, but she did resolve the issue by the next business day after she was alerted that there might be an error. As to the issues of whether or not Ms. Lawhon made a willful oral misrepresentation to Ms. Freed on March 26, 2002, or on the April 1, 2002, Shell Point Realty, Inc., check as to how long Ms. Shepard had occupied 111 Razorback Road or was willfully withholding funds on April 1, 2002, it is more significant that from the very beginning of this series of events on October 15, 2001, Ms. Lawhon told Ms. Shepard to make out her checks to Mr. Petrik and that none of Ms. Shepard's checks were ever in Respondents' possession until March 26, 2002. Therefore, together with Ms. Lawhon's overwrought state of mind on April 1, 2002, it is not clear whether there was a willful misrepresentation, a misunderstanding, a miscommunication, or a miscalculation with regard to the first transmittal of only part of the rental funds on April 1, 2002, and the time line is not so clear that Ms. Freed's and the Agency's sinister construction of Ms. Lawhon's communications and calculations can be the only construction. Without the Agency's sinister construction of events, there is only clear and convincing evidence that Ms. Lawhon undertook, without expectation of a direct real estate commission, to rent 111 Razorback Road for Mr. Petrik, regardless of what entity actually held title thereto. In doing so, she undertook a fiduciary relationship with him and Ms. Shepard. In this capacity, she received a $450.00 cash deposit, which she retained for over five months without clear authority to retain it, and she did not timely deposit it in a trust or other appropriate account for Mr. Petrik's benefit. She did not follow up on getting a lease executed by the parties, which, based on hers and Ms. Freed's prior course of dealing, Ms. Freed could have reasonably expected and which Ms. Shepard clearly did expect. When Ms. Freed inquired about the matter in March 2002, Ms. Lawhon, to her credit, tried to resolve the matter quickly and appropriately. However, in the course of resolving it, she did not get an executed lease as expected; she endorsed checks made out to Mr. Petrik without clear authority to do so; she did not deposit funds from those checks into an appropriate account; and she repeatedly miscalculated amounts due and remitted incorrect amounts to Mr. Petrik, via Ms. Freed. She also did not discover her errors on her own, but had to be alerted by the lawyer on April 12, 2002. While I detect no dishonest intent, nor any intent to permanently convert any funds to her personal use, the fact that Ms. Lawhon ultimately transmitted to Mr. Petrik the full amount due is not particularly to her credit, since her actions--or lack of action--had the effect of depriving Mr. Petrik of the use of a portion of those funds for nearly six months.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Real Estate Commission enter a final order which: Finds Respondents Mary Lawhon and Shell Point Realty, Inc., guilty of Section 475.25(1)(k), Florida Statutes, Counts III and VI, respectively, of the Administrative Complaint; Provides as a penalty for Mary Lawhon the payment of a $1,000.00 fine and five months' suspension of her licenses; Provides as a penalty for Shell Point Realty, Inc., a reprimand; and Dismisses Counts I, II, IV, and V of the Administrative Complaint. DONE AND ENTERED this 21st day of April, 2003, in Tallahassee, Leon County, Florida. ELLA JANE P. DAVIS 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 April, 2003.
Findings Of Fact Petitioner is the governmental agency responsible for issuing licenses to practice real estate and for regulating licensees on behalf of the state. Respondent is a licensed real estate sales person under license number 0466167. Respondent's real estate license was invalid during the dates at issue in this proceeding. The license expired on September 30, 1993, and was activated on February 1, 1994. The last license issued to Respondent was issued as a voluntary inactive sales person at 171C Springwood Boulevard, Longwood, Florida. On October 28, 1993, Mr. Frank Canty, terminated Respondent from employment at Frank G. Canty Realty ("Canty"). Mr. Canty notified Respondent of the termination by telephone on or about the same day and immediately filed the form required to notify the Florida Real Estate Commission (the "Commission") of Respondent's change in status. 2/ Mr. Robert Sirianni and Respondent are long time friends. Mr. Sirianni is the broker and owner for Bay Hill Realty, Inc ("Bay Hill"). Mr. Sirianni hired Respondent as a real estate sales person for Bay Hill on November 22, 1993. Mr. Sirianni signed the completed form required to notify the Commission that Respondent had placed his license with Bay Hill. Mr. Sirianni gave the completed form to Respondent to hand deliver to the Commission. However, Respondent failed to deliver the form to the Commission. On November 22, 1993, Respondent showed a condominium to prospective buyers. Respondent represented that he was an employee of Canty. Respondent delivered a written offer of $36,000 to Watson Realty Corporation ("Watson"), the listing office. Respondent used his Canty business card in the transaction. A representative of Watson contacted Mr. Canty to discuss some problems in the transaction. Mr. Canty informed the representative that Respondent was terminated from Canty on October 28, 1993. Watson caused a new contract to be executed between the buyers and sellers showing Watson Realty as the listing and selling office. The transaction closed on the new contract. On December 13, 1993, Mr. Sirianni faxed a memorandum to Watson claiming the sales commission purportedly earned by Respondent. Mr. Sirianni withdrew the demand after learning of the facts and circumstances surrounding the matter.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a Final Order: finding Respondent guilty of violating Sections 475.25(1)(b), 475.25(1)(e), and 475.42(1)(b); authorizing the issuance of a written reprimand; placing Respondent on probation for one year; and imposing a fine of $1,000 to be paid in accordance with this Recommended Order. RECOMMENDED this 9th day of May, 1995, in Tallahassee, Florida. DANIEL MANRY 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 9th day of May 1995.
The Issue Whether either Respondent violated the provisions of chapter 475, Florida Statutes,1/ regulating real estate sales associates, as alleged in the administrative complaints, and if so, what sanctions are appropriate.
Findings Of Fact The Florida Real Estate Commission, created within the Department, is the entity charged with regulating real estate brokers, schools, and sales associates in the State of Florida. The Division of Real Estate is charged with providing all services to the commission under chapters 475 and 455, Florida Statutes, including recordkeeping services, examination services, investigative services, and legal services. In 2006, Ms. Linda Fiorello and Ms. Catherine Lichtman, associates at another brokerage, decided to open up their own real estate business, with each owning a fifty-percent share. They created Luxury Realty Partners, Inc. (“the corporation”), a licensed real estate corporation in the State of Florida. While Ms. Lichtman was initially the qualifying broker, she soon stepped down from that position and a series of other individuals served as brokers for the corporation. Neither Ms. Fiorello nor Ms. Lichtman was licensed as a real estate broker at any time relevant to the Administrative Complaints. The corporation sold, exchanged, or leased real property other than property which it owned and it was not an owner-developer. On April 23, 2010, Mr. Brian Davis was added as the sole officer and director of the corporation, and he became the qualifying broker. At all times material to the complaints, Ms. Fiorello and Ms. Lichtman were licensed as real estate sales associates in the State of Florida, Ms. Fiorello having been issued license number 659087 and Ms. Lichtman having been issued license number 3170761. They worked together at the corporation, nominally under the direction, control, and management of Mr. Davis. The corporation did not maintain an escrow account. Mr. Davis did not manage any of the corporation’s bank accounts. He was not a signatory on the operating account. He did not collect brokerage commissions or distribute them to sales associates. He testified he went into the office “maybe once, once or twice a month.” When he agreed to become the qualifying broker for the corporation, he did not even know all of the names of the agents he was supposed to be responsible for. Mr. Davis stated: Well, basically, I was just doing a favor and I was – I put my license there until one of the other two could get their Broker’s license. I was just really stepping in for a short term to – to fill the time frame until one of them could get their Brokerage license, and I didn’t go on any management or any other books or anything of that nature. As Ms. Patty Ashford, one of the sales associates testified, Mr. Davis was seldom in the office. Ms. Ashford would turn in her contracts to Ms. Fiorello or Ms. Lichtman, who would review them. Ms. Ashford testified that her commission checks were then paid by checks signed by Ms. Lichtman. In short, Mr. Davis effectively provided no direction, control, or management of the activities of the corporation or its sales associates. In December of 2009, Ms. Jennie Pollio was living at 10861 Royal Palm Boulevard in Coral Springs, Florida (the property), a Section 8 property that she had been renting from Mr. Jimmy Laventure for about nine years. The property was in foreclosure. Ms. Pollio thought that she might be able to buy the property. She consulted Ms. Victoria Guante, a real estate sales associate with Luxury Realty Partners, Inc. Ms. Pollio knew Ms. Guante because they both had sons who played baseball on the same team. Ms. Guante told Ms. Pollio to get $40,000.00 in cashier’s checks and put it in escrow with Luxury Realty Partners, Inc., so that she could make a strong offer and show that she really had the money. Although they were not produced as exhibits at hearing, Ms. Pollio testified that she signed a couple of different contracts for the property in early 2010. On or about April 29, 2010, Ms. Guante accompanied Ms. Pollio to the bank to get cashier’s checks. Ms. Pollio received five Bank of America cashier’s checks made out to “Luxury Partner Realty,” four in the amount of $9000.00, and one in the amount of $4000.00. Ms. Pollio understood that the property could be purchased for a total of $40,000.00, which included $37,000.00 for the property, and the balance in closing costs. The cashier’s checks were not given to a broker. Ms. Pollio gave the $40,000.00 to Ms. Fiorello as a deposit on the property when she met with her in the corporation office on State Road 7. Ms. Pollio made a copy of the cashier’s checks and Ms. Fiorello wrote a note on the bottom of the copy, “Received by Linda A. Fiorello for Luxury Escrow deposit on contract 10861 Royal Palm Blvd Coral Springs FL 33065” and gave it back to Ms. Pollio.2/ Although the payee name on the cashier’s checks was transposed, Ms. Pollio gave the checks to Ms. Fiorello as agent of the corporation as a deposit on the property, and Ms. Fiorello accepted the checks on behalf of the corporation for the same purpose. Ms. Fiorello did not advise Mr. Davis that the checks had been received. Instead, she deposited the checks in an account formerly belonging to Luxury Property Management, an entity unaffiliated with Luxury Realty Partners, Inc.3/ Luxury Property Management had never been a licensed real estate brokerage corporation, and was no longer in existence, as it had been dissolved. The account had never been properly closed. The account usually had a low balance. Just prior to the deposit of Ms. Pollio’s money, the balance was $10,415.15. Ms. Lichtman had no ownership or interest in Luxury Property Management, but she was aware of the account. The corporation did not have an escrow account, and the Luxury Property Management account was sometimes used to hold money “in escrow,” as Ms. Lichtman was aware. As he testified, Mr. Davis knew nothing about this account and did not authorize Ms. Fiorello to place Ms. Pollio’s deposit there. Ms. Fiorello’s contrary testimony that she told Mr. Davis of the transaction and had his authorization was not credible and is rejected. Ms. Guante was negotiating for the property on Ms. Pollio’s behalf. She testified: At that point the guy was asking (unintelligible) I think was sixty-five, and then we made the offer for $40,000.00. The guy came back and say “no,” and then we went back and make another offer for $50,000.00, and then by that time the guy still say “no.” And then her and I get into an argue because baseball game that don’t have nothing to do with the real estate and then she decided she don’t want me no more as her agent. Ms. Guante called Ms. Fiorello and told her that Ms. Pollio didn’t want to work with Ms. Guante anymore. Ms. Fiorello told Ms. Guante not to worry about it, that the corporation would handle the transaction for Ms. Pollio. On September 23, 2010, a check in the amount of $40,000.00 was written from the Luxury Property Management, LLC, account to Luxury Realty Partners. It is undisputed that the hand writing on the “amount” and “pay to the order of” lines on the check was that of Ms. Lichtman, while the signature on the check was that of Ms. Fiorello. This check, posted into the corporation’s operating account the same day, along with a check for $6000.00, left a balance of only $684.15 in the Luxury Property Management, LLC, account. The two sales associates gave completely different explanations for the check. Ms. Fiorello testified that she always left one or two signed checks locked in the office when she was out of town. She testified that only she and Ms. Lichtman had keys to the lock. Ms. Fiorello testified that without her knowledge, Ms. Lichtman had removed a signed check and filled in the top portion. She testified that although it was her account, she did not realize that the money had been removed until around May 2011, some eight months later.4/ On the other hand, Ms. Lichtman testified that on numerous occasions, the two associates would write out checks together, and that in this instance they discussed the transfer in connection with the opening of a Rapid Realty real estate office in New York which involved Ms. Fiorello’s son. Ms. Lichtman testified that she filled out the top portions of the check, and Ms. Fiorello then signed it. Ms. Lichtman testified that the $40,000.00 “represented monies coming back into Luxury Realty Partners from Rapid Realty.” Ms. Lichtman did not explain why funds from Rapid Realty to repay a loan from Luxury Realty Partners would have been deposited into the Luxury Property Management account, and records for the Luxury Property Management account do not reflect such deposits. On November 4, 2010, a little over a month later, Ms. Lichtman transferred $40,000.00 from the corporation operating account into an account for Chatty Cathy Enterprises, an account controlled by her, and inaccessible to Ms. Fiorello. Ms. Lichtman’s explanation for these transfers, that the $40,000.00 came from the New York real estate venture in repayment of a loan made from the corporation, was unpersuasive, and is rejected. First, the only documentary evidence of a loan made to the “start-up” was an unsigned half-page note dated April 30, 2010. That document indicated that an interest-free business loan in the amount of 25,000 would be made from the corporation to “Rapid Realty RVC and its owners” and that re- payment of the loan would be made in monthly payments to the corporation. No amount was specified for these payments. Similarly, there was no evidence of any repayment checks from Rapid Realty to Ms. Fiorello, Ms. Lichtman, or the corporation. A document dated November 5, 2010, purports to be a “formal release” of that loan. It states in part: The above stated note lists a dollar amount of $25,000 dollars which is inaccurate. The total balance of the loan was approximately $48,000 dollars that was loaned by Luxury Partners Realty (sic), Catherine A. Lichtman and Linda A. Fiorello. This is the formal dollar amount of the loan that is considered paid and satisfied in full. This release appears to be signed by Ms. Lichtman and Ms. Fiorello. Even assuming that the loan had been repaid in full by the New York venture (although no corporation account deposits indicate this), it is not credible that Ms. Lichtman believed she was personally entitled to a payment of $40,000.00 for repayment of a $48,000.00 loan made by the corporation. The spreadsheet of itemized expenses of the New York office and offered by Ms. Lichtman as proof of amounts loaned has no apparent correlation to a spreadsheet prepared by Ms. Lichtman purporting to show checks and cash amounts transferred to New York.5/ In January 2011, Ms. Teresa Ebech, the listing agent for the property with First United Realty, took another contract for the Royal Palm property to Ms. Pollio. This contract referenced a $40,000.00 deposit and listed “Luxury Property Mgt. Escrow” as the escrow. This contract indicated a total purchase price of $55,000.00, and called for a February 21, 2011, closing date. Ms. Pollio signed the contact. The closing did not occur. Ms. Pollio decided to stop trying to buy the property and get her money back. No other party ever acquired an interest or equity in the deposit. Ms. Pollio had difficulty getting in touch with Ms. Fiorello about getting her money back. When Ms. Pollio finally was able to ask Ms. Fiorello for a return of her deposit, Ms. Fiorello did not return it, but told Ms. Pollio that she should get it from Ms. Lichtman. On or about April 28, 2011, Ms. Pollio, with help from her friend, Ms. Joyce Watson, prepared a letter to cancel the contract. The letter noted that the $40,000.00 had been in escrow for over a year and stated that due to the inability of Luxury Realty Partners to close on the property, Ms. Pollio requested immediate return of the deposit. The letter was sent to Catherine Lichtman at the Luxury Realty Partners, Inc., address. Ms. Lichtman’s testimony that she never received the letter is discredited. Ms. Ashford, another real estate sales associate at the corporation, had never met Ms. Pollio, but was in the Luxury Realty Partners, Inc., office one day in May of 2011 when Ms. Pollio came in with her husband. Ms. Ashford testified: She came in with her husband pretty much screaming and yelling from the minute she stepped foot in the door. She was very angry, very upset. I looked at her and said, you know, Ma’am please calm down. She said I’m not calming down. She pointed at Cathy, she said she knows exactly why I’m f’in here. This has nothing to do with you. Ms. Lichtman asked Ms. Ashford to call her husband, which Ms. Ashford did, thinking this was unusual because he never had anything to do with what went on at the office. Ms. Pollio yelled at Ms. Lichtman, and Ms. Lichtman yelled back, each becoming more and more agitated. Ms. Lichtman then left the room and locked the door. The police were called, though Ms. Ashford was not sure if it was Ms. Pollio or her husband, or perhaps Ms. Lichtman’s husband, who called them. Ms. Ashford testified that when the police officer arrived, Ms. Lichtman lied and told him that her name was Victoria. The officer tried to calm both parties, and told them it was a civil matter. The police officer finally persuaded Ms. Pollio and her husband to leave. Ms. Ashford testified as follows about the conversation that took place between Ms. Lichtman and Ms. Ashford after Ms. Pollio left: Q What did you say? A I asked her point blank what the hell was going on and she responded. Q What did she respond? A That yes, she had her money. The money was-– Q When you said her money. What-–what are talking about? A She had Jennie’s money. Q She-- A It was a deal, a transaction. “She came into our office with cash coming out of her boobs and I don’t have to give it back.” Were her words. Q Did you tell Cathy that she had to return the money? A Yes, I did. I said “Cathy, its escrow money, it doesn’t matter where she got it from,” and Cathy went on about “it’s illegal she’s a dancer, she’s on Section 8. I’m going to report it to the IRS. She thinks she buying a f’in house.” Ms. Lichtman’s admission to Ms. Ashford after Ms. Pollio left showed that Ms. Lichtman knew that she had money in her possession that had been given by Ms. Pollio to buy a house. Ms. Ashford testified that she was upset, as an agent with the corporation, about what appeared to be going on. She and Ms. Fiorello met with Mr. Davis in April of 2011. Ms. Fiorello told Mr. Davis that Ms. Lichtman had stolen funds. Mr. Davis reviewed the January contract that Ms. Fiorello gave him, and concluded that it didn’t make much sense. He had not given any authorization to place escrow funds into the Luxury Property Management, LLC, account. He did not have access to that account or to any of the corporation’s operating accounts to determine if money was missing. After the meeting, Mr. Davis asked Ms. Lichtman what she knew about the accusation. Ms. Lichtman denied that she took any money from an escrow account. Mr. Davis called the Florida Real Estate Commission and reported the incident. At some point, Ms. Lichtman advised Ms. Pollio that the cancellation letter was not sufficient, and provided Ms. Pollio with a “Release and Cancellation of Contract for Sale and Purchase” form. Mr. Laventura signed the form in June 2011, and Ms. Pollio signed the form when she returned it to Ms. Lichtman at the Luxury Realty Partners, Inc., office. The form released Luxury Partner Realty from liability and indicated that the escrow agent should disburse all of the $40,000.00 deposit to Ms. Pollio. At the time of the final hearing, Ms. Pollio had yet to receive her $40,000.00 deposit back. The testimony and documentary evidence in this case clearly demonstrates a recurring and systematic disregard of the legal entities and procedures intended to provide structure and accountability to business and real estate transactions by both Ms. Fiorello and Ms. Lichtman. Ms. Fiorello and Ms. Lichtman employed a qualifying “broker” for the corporation, but intentionally assumed the responsibilities of that position themselves during the time relevant to the Administrative Complaints. In doing so, they each operated as a broker without being the holder of a valid and current active brokers’ license. No evidence was introduced at hearing to indicate that the professional license of either Ms. Fiorello or Ms. Lichtman has ever been previously subjected to discipline.
Recommendation Upon consideration of the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that final orders be entered by the Florida Real Estate Commission: Finding Linda Fiorello in violation of sections 475.25(1)(k), 475.25(1)(d), 475.42(1)(d), 475.42(1)(a), 475.25(1)(b), and 475.25(1)(a), Florida Statutes, as charged in the Amended Administrative Complaint, and imposing an administrative fine of $10,000.00, reasonable costs, and revocation of her license to practice real estate; and Finding Catherine A. Lichtman in violation of section 475.25(1)(d), Florida Statutes, as charged in the Administrative Complaint, and imposing an administrative fine of $1000.00, reasonable costs, and revocation of her license to practice real estate. DONE AND ENTERED this 11th day of June, 2015, in Tallahassee, Leon County, Florida. S F. SCOTT BOYD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 11th day of June, 2015.
Findings Of Fact The Petitioner is an agency of the State of Florida charged with the responsibility to license and regulate the licensure standards of real estate brokers and salespersons in the State of Florida and with prosecuting Administrative Complaints against the licensure status of those persons for alleged violations of the various provisions of Chapter 475, Florida Statutes (1991), and the rules promulgated thereunder. The Respondent at all times material hereto was a real estate broker- salesperson operating and licensed in the State of Florida having been issued license number 0162601. The last license issued the Respondent was effective on September 30, 1991 and accorded him the status of a "non-active broker" with an address at 5622 Thomas Drive, Panama City, Florida 32408. In 1987, Barbara Jean Parmer, also known as Barbara Jean Withers (hereafter Barbara Parmer), responded to a newspaper ad and rented a residential property from the Respondent. She gave the Respondent a damage deposit of approximately $395.00. Subsequent to renting the property, she expressed an interest in buying it from the Respondent and was advised by the Respondent that she could seek financing from his lender or she could make payments directly to the Respondent; and when he was fully paid, he would transfer the deed to her and pay off the existing first mortgage. This was the first occasion she had ever attempted to purchase a home. The Respondent told Barbara Parmer that the existing mortgage balance was $29,000.00 and that to sell her the property, he wanted a $5,000.00 down payment and $12,000.00 in "rent" for a total sales price of $46,000.00. In effect, the so-called payments would be payments toward purchase of his equity in the home. On October 9, 1987, the Respondent and Barbara Parmer executed a "Receipt for Deposit-Offer to Purchase-Contract for Sale" (contract) reflecting a $5,000.00 earnest money deposit for property located at 335 Gardenia Street, Panama City, Florida. On that day, Barbara Parmer gave the Respondent check number 108 for $5,000.00 as the down payment on the house. He cashed that check on October 12, 1987. The Respondent drafted the contract at issue and did not advise Barbara Parmer to have an attorney review the document. Barbara Parmer testified that she trusted the Respondent, in effect, because he was a real estate licensee. When she signed the contract and gave the earnest money deposit or down payment, she understood that she was contracting to purchase the property from the Respondent. Sometime after signing the contract and the tendering of the earnest money deposit, Barbara Parmer (then Withers) married David Parmer. Subsequent to the signing of the contract and the payment of the earnest money deposit, the Respondent advised the Parmers that he was getting divorced. He told them he did not want his wife to gain possession of the property and so suggested that Barbara Parmer go to Sun Bank to have the property transferred into her name, in other words, by re-financing the house with Sun Bank and thus paying off the existing first mortgage and any equity still owed the Respondent. After the Respondent told the Parmers about his impending divorce, Mr. Parmer asked the Respondent to return the $5,000.00 earnest money deposit. The Respondent advised that if he sold the house, he would return the deposit, which was being held in an account drawing interest, according to the Respondent. He also represented that he would not refund any of the money expended by them for improvements because he had not requested that any of the improvements be made. He had apparently taken the position in entering the arrangement with Barbara Parmer that it was a sale of the property under a "contract for deed" arrangement whereby title would pass only after his purchase price had been paid. In any event, Barbara Parmer went to Sun Bank and was advised by Loan Officer, Cindy McNeal, that the documents entered into between Barbara Parmer and the Respondent regarding purchase of the property were legally flawed in the opinion of Ms. McNeal and that Barbara Parmer should seek an attorney's advice. Sun Bank declined to refinance the property because Mr. Parmer was then unemployed due to an accident and was only receiving income from worker's compensation and no salary. After the conversation with the representative of Sun Bank, Barbara Parmer called Great Western, the holder of the first mortgage executed by the Respondent, to inquire as to the balance due on that first mortgage. Barbara Parmer received a document from Great Western dated November 13, 1990 indicating that the balance on the mortgage was approximately $33,000.00. In 1987, when she contracted with the Respondent to purchase the property, the Respondent had told her that the balance was approximately $29,000.00. The first mortgage was apparently an adjustable rate mortgage and either the represented $29,000.00 figure was inaccurate or the mortgage was in negative amortization or both. The Respondent never advised the Parmers of any negative amortization situation. Between October 9, 1987 and March or April of 1991, Barbara Parmer paid the Respondent between $400.00 and $500.00 per month toward purchase of the property. The checks for the monthly payments were payable to Respondent Melvin J. Powell and were negotiated by Powell. At the direction of the Respondent, the payments were made at the office of Sun Spot Realty. During this time, the Respondent's licensure was located and registered with Sun Spot Realty. The variation in the monthly payment was because the Respondent advised Barbara Parmer that the monthly payment on the first mortgage held by Great Western was $200.56 and that anything she paid over that amount would go toward the $12,000.00 equity she owed the Respondent pursuant to their agreement. Some months she paid different amounts over and above the amount represented by the monthly payment on the Great Western first mortgage. The Respondent gave Barbara Parmer a ledger sheet showing the dates she made payments on the property, the amount that went to Great Western to retire the first mortgage, and the amount that went to the Respondent toward the $12,000.00 second mortgage representing his equity, as well as the amounts contributed to interest, taxes, and insurance. During the approximately three and one-half years that she lived in the house, she made improvements to the property, including but not limited to: landscaping the front and back yards, pouring a foundation, erecting a metal shed, repairing the roof, painting the interior and exterior, replacing the walls and floor in the bathroom, wallpapering and finishing the kitchen, and installing a new dishwasher and a new hot water heater. Respondent never expended any funds for upkeep of the property during the time the Parmers occupied the house. The Parmers spent at least $5,000.00 on improvements to the property they were purchasing from the Respondent. The Respondent told them then to make whatever improvements they wished because the house was theirs. The Parmers would not have spent the money on the improvements had they not believed that they were purchasing the property. After attempting to obtain financing from Sun Bank, Barbara Parmer contacted Attorney Glenn Hess, who sent a letter to Respondent's counsel regarding Barbara Parmer's concerns. Prior to seeing Attorney Hess, the Respondent had admonished Barbara Parmer not to see an attorney, that the matter could be settled amicably between them, and he threatened to sue her if she did contact an attorney about her concerns. The Respondent told Mr. Parmer that Barbara Parmer had a legal contract to purchase the property and warned against them seeking legal advice by threatening to sue them for breach of contract if they did so. Attorney Hess advised Barbara Parmer that it would be uneconomical to file a lawsuit against the Respondent. Despite demand for return of the earnest money deposit, the Respondent never returned the deposit nor did he ever compensate the Parmers for the funds they expended on improvements to the property. They vacated the property on advice of their attorney. The Respondent never gave notice to the Parmers that he was claiming any of their funds for damage to the property or for breach of contract. When they vacated the property, there was no damage to the property other than a five-inch hole in one bedroom wall. Within two months of the Parmers moving out, the Respondent rented the property to another tenant for almost $100.00 per month more than the Parmers had been paying. On the advice of Attorney Hess, the Parmers filed a complaint against the Respondent with the Bay County Board of Realtors, Inc. Thomas S. Newbauer has been a licensed real estate broker since 1973 and serves as chairman of the Professional Standards Committee (hereafter Committee) of the Bay County Board of Realtors. The Committee hears cases and renders decisions on allegations of violations of the Board of Realtors' code of ethics. In September, 1991, Mr. Newbauer served as a member of the panel appointed by the Committee in considering the complaint filed by the Parmers against Respondent. A hearing was held by the appointed panel to consider the complaint filed by the Parmers against the Respondent. The Respondent was notified of the hearing and appeared and testified. On September 30, 1991, the ethics hearing panel of the Committee filed a decision regarding the Parmer complaint against the Respondent and determined that the Respondent had violated three articles of the realtor code of ethics and further that there might be grounds for investigation by the Florida Department of Professional Regulation. On October 1, 1991, Mr. Newbauer sent a letter to the Board of Directors of the Board of Realtors informing them of the determination of the panel of the Committee. The determination by the panel that the Respondent had violated the code of ethics was upheld by the Board. Paul R. Bratton, III has been a real estate investigator with the Department of Professional Regulation for some nine years. The Respondent told Mr. Bratton that he had kept the $5,000.00 earnest money deposit because the Parmers had breached the contract.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, and the pleadings and arguments of the parties, it is RECOMMENDED that the Respondent be found guilty of having violated Section 475.25(1)(b), Florida Statutes, and that his Florida real estate license be suspended for a period of one year, that he be accorded a formal written reprimand, that he complete 60 hours of post-licensure continuing education for brokers within three years from the date of the Final Order entered in this cause, and that he pay a fine of $1,000.00 to the agency within 30 days of the filing of the Final Order in this cause. DONE AND ENTERED this 13th day of May, 1993, in Tallahassee, Florida. P. MICHAEL RUFF 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 13th day of May, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 92-3751 Petitioner's Proposed Findings of Fact 1-46. Accepted. Respondent's Proposed Findings of Fact The Respondent filed no separately-stated findings of fact but rather a one-page "Proposed Recommended Order" merely stating the conclusions that the Respondent was not guilty of the charges in Counts I and II of the Administrative Complaint and the statutes he was charged with violating. COPIES FURNISHED: Ms. Darlene F. Keller Division Director Department of Professional Regulation Division of Real Estate P.O. Box 1900 Orlando, FL 32802-1900 Jack McRay, Esq. General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792 Janine B. Myrick, Esq. Department of Professional Regulation Division of Real Estate Post Office Box 1900 Orlando, FL 32802-1900 Melvin J. Powell 2610 Dade Panama City, FL 32408 Melvin J. Powell 5622 Thomas Drive Panama City, FL 32408
The Issue The issue in this case is whether Petitioner, a licensed Florida real estate associate, violated provisions of Subsections 475.278(2) and 475.25(1)(q), Florida Statutes (2007),1 and, if so, what discipline should be imposed.
Findings Of Fact The Department is the state agency responsible for, inter alia, licensing and monitoring real estate sales associates within the state. Its headquarters is in Tallahassee, Florida. The Department is charged with the responsibility and duty to prosecute administrative complaints concerning real estate sales associates. Saxer is a licensed real estate sales associate, holding License No. 3110487. Saxer is employed by Century 21 Palm Realty of Pasco, Inc., in New Port Richey, Florida. At all times relevant hereto, Saxer was the listing agent for a property located at 3831 Sail Drive, New Port Richey, Florida (hereinafter referred to as the "Subject Property"). The Subject Property is an approximately 40-year- old house that had not been inhabited for some time. The owners, Gary and Albert Osborne (referred to herein as the Sellers), had inherited the house, but had never resided in it. The Sellers were Saxer's client in the sale transaction concerning the Subject Property. Leon and Christine Ausburn (the Buyers) entered into a Residential Sale and Purchase Contract (the Contract) to purchase the Subject Property from the Sellers. Saxer negotiated the contract between the Buyers and the Sellers. The Contract was signed by the Buyers on June 8, 2007, and by the Sellers on June 12, 2007. The Contract called for a closing on or before June 29, 2007. On April 27, 2007, when the Sellers listed the Subject Property with Saxer's employer, the Sellers confirmed that they knew of no roof leaks or defects. The Sellers had inherited the property and were not living in it at that time. The Subject Property was not inhabited at any time during the pendency of the Contract. At some time after signing the Contract, the Buyers did an on-site inspection of the Subject Property. They noticed several stains on the ceilings around the house and inquired of their real estate sales agent about the stains. They received assurance from their agent that the property would be inspected to make sure there were no leaks or damages. The Buyers did not follow up with their agent, nor did they ever see an inspection report indicating his findings. On or about June 14, 2007, the Sellers called Saxer to say there appeared to be a roof leak at the Subject Property. They asked Saxer to take care of having the roof leak repaired. Saxer obtained an estimate from World Class Roofing Services, Inc., for $725 to repair the roof. Saxer contracted with the roofing company to make the necessary repair. A ten-foot by ten-foot section of the Subject Property's mansard roof was replaced by the roofing contractor.2 The leak was in a smaller section, but more of the roof was replaced to insure against further leaks. None of the evidence elicited at final hearing gave any indication of what part of the roof was repaired, i.e., whether it was over the living room, a bedroom, or some other area of the house. The repair estimate describes it as being over the dining room, but no evidence was offered as to where the dining room was in relation to the living room, garage, or other parts of the house. The Contract had a purchase price of one hundred twenty-seven thousand and five hundred dollars ($127,500). Paragraph 5 of the Contract required the Sellers to pay for any improvements up to 1.5 percent of the purchase price (i.e., up to an amount of $1,912.50). The Contract also describes the sale and purchase as an "As Is" sale for wood-destroying organism damages. Inasmuch as the cost of the roof repair was less than the 1.5 percent threshold in the Contract, Saxer did not believe she needed to disclose the repair to the Buyers or Buyers' agent. She did not deem it a "material" defect affecting the value of the Subject Property. The closing was held on June 29, 2007. At the closing, a U.S. Department of Housing and Urban Development closing statement was used to provide the statement of actual settlement costs for the transaction. The Buyers and Sellers were both provided copies of the closing statement and signed an acknowledgement of receipt. The closing statement indicates at Line Item 1314, "Roof repairs paid by seller to World Class Roofing Services, Inc.," and indicates the sum of $725. Christine Ausburn, one of the Buyers, is a licensed mortgage broker. She testified that she did review the closing statement, but did not notice the line item concerning a roof repair, because she only looked at the Buyers' side of the statement. On that same day, after finalizing the closing, the Buyers went to visit the Subject Property. Upon entering the home, they noticed a puddle of water on the living room floor and a flooded garage. The water had come, it appears, from a leaking pipe in the ceiling over the garage area. There is no evidence that the water in the garage was caused by or related to the roof repair done pursuant to Saxer's direction. After seeing the water in the garage, the Buyers notified Saxer that they were very upset. Saxer contacted the entity that had performed the roof repair and sent them to the Subject Property. Finding no one home, the roofers left a message and contact information so that they could make any repairs that related to their earlier work which was guaranteed. It is not known whether the Buyers followed up with the roofers or not. The Buyers also determined after closing that the air conditioning system for the Subject Property was not working properly. There is no indication from the record that Saxer or the Sellers were aware of that problem prior to closing. The Buyers had visited the Subject Property prior to closing, but did not have an inspection done to determine potential problems or defects. They had witnessed a number of water stains on the ceilings, but presumed them to be old in nature. The Buyers were told by their own real estate agent that he would "have his people check it out." The Buyers do not know if their agent ever did so, nor did they ever see an inspection report on the Subject Property. The Buyers are completely dissatisfied with the Subject Property due to many reasons. However, there is no indication that Saxer was aware of any material problem extant at the time of closing. Saxer did not consider the minor roof repair a material defect in the Subject Property.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by Petitioner, Department of Business and Professional Regulation, Division of Real Estate, dismissing the complaint against Respondent, Christine A. Saxer. DONE AND ENTERED this 27th day of March, 2009, in Tallahassee, Leon County, Florida. R. BRUCE MCKIBBEN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 27th day of March, 2009.
Findings Of Fact Respondent is now and was at all times material to this action a licensed real estate broker in the State of Florida, holding license number 0064475. Respondent operated his own real estate brokerage firm under his license. The firm was located in Niceville, Florida. In addition to his real estate brokerage business Respondent maintained and managed his personal real estate investments. Several of these personal investments included rental property which Respondent would later sell. One such piece of property was located at 104 Perdido Circle, Niceville, Florida, and is the property involved in this action. Prior to July 6, 1985, the Respondent, as seller and not as a broker, advertised for sale the Perdido property. Sometime around July 6, 1985, Robert L. Mitchell and June F. Mitchell looked at the Perdido property. Frank Ray, a salesman for John Brooks Realty, an unrelated real estate firm showed the property to the Mitchells. They liked the property and wanted to buy it. Frank Ray made arrangements for himself and the Mitchells to meet with Respondent in order to discuss the terms of the potential purchase contract. They met on July 6, 1985. The meeting lasted approximately an hour to an hour and a half. During the lengthy meeting Respondent went over the purchase terms contained in the contract of sale. The Mitchells main concern was to have immediate occupancy of the house. Special terms were developed for renting the property. At some point during the meeting the down payment came under discussion. Originally, the Mitchells had planned on a $1500 down payment which was acceptable to Respondent. However, as the meeting progressed the Mitchells decided they would like to reduce the amount of the down payment. Respondent informed the Mitchells that the only way he could decrease the $1500 down payment was to make the money a non-refundable option payment. Respondent then marked out the $1500 down payment figure contained in the purchase contract and inserted a $1200 figure. Respondent concurrently added the language "option payment" next to the $1200 figure. The remainder of the contract was discussed and the Mitchells signed the amended document. The Mitchells then wrote a check to Respondent, personally, in the amount of $1200. The note section of the check the Mitchells wrote contained the language "house down payment." The exact discussion on the down payment/option is not clear. What is clear from the evidence is that neither party had a meeting of the minds over what the $1200 check was. The Mitchells being very inexperienced in real estate thought it was a down payment. Although it is doubtful the Mitchells understood the legal meaning of the term "down payment." Respondent thought it was a non- refundable option payment. Absolutely no evidence of fraud or misrepresentation on the part of Respondent was demonstrated. Likewise, there was no evidence that Respondent in any way used his knowledge or expertise in the real estate market improperly. The final result of the negotiations was that the Mitchells had entered into what on its face purports to be a rental contract with an option to buy. However, since there was no meeting of the minds over the option, the option was eventually unenforceable. Since there was no meeting of the minds regarding the $1200 the money was not properly escrowable property. In essence the $1200 was neither a down payment nor an option payment. This lack of escrowability is borne out by the sales contract which calls for another escrow agent. 1/ The Mitchells took possession of the property for approximately three months. The Mitchells failed to obtain financing. The contract was conditioned upon the Mitchells obtaining financing, and the transaction failed to close. A dispute arose between the parties concerning the down payment/option money. When the dispute could not be resolved by the parties, the Mitchells filed a lawsuit against Nevin H. Nordal demanding a refund of the $1200 "house down payment." As a result of the Mitchell's lawsuit the County Court, in Okaloosa County, Florida, Summary Claims Division, by Amended Final Judgment dated January 20, 1987, awarded the sum of $1,028,87. The judgment figure is the balance of the $1200 after deduction of a counterclaim of $171.13 for cleaning the house after the Mitchells evacuated the property. Additionally, the Respondent was required to pay costs in the sum of $57 for a total of $1,087.87 due the Mitchells. The judgment amount is bearing interest at a rate of 12 percent per annum. The County Court judgment contains no findings of fact as to the Judge's reasoning on the judgment award. The Mitchells have repeatedly demanded of the Respondent that he pay the judgment. He has repeatedly refused to pay the judgment. Respondent did account to the Mitchells for the money when he told them he had deposited the check and had spent the funds.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is therefore RECOMMENDED that the Administrative Complaint failed against Respondent, Nevin H. Nordal, be dismissed. DONE and ENTERED this 4th day of March, 1989, in Tallahassee, Leon County, Florida. DIANE CLEAVINGER 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 4th day of March, 1989.
