10-000389PL Department Of Business And Professional Regulation, Division Of Real Estate vs. Heriberto Alonso Status: Closed Recommended Order on Tuesday, June 8, 2010.

Summary: Respondent found guilty of "concealment" for failing to inform sellers of properties that selling price had been increased significantly over their asking price and agreed-contract price.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case No. 10-0389PL

)

HERIBERTO ALONSO, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case

before Larry J. Sartin, an Administrative Law Judge of the

Division of Administrative Hearings, on April 2, 2010, by video

teleconference between Lauderdale Lakes and Tallahassee,

Florida.

APPEARANCES

For Petitioner: Jennifer Blakeman, Senior Attorney

Department of Business and

Professional Regulation

400 West Robinson Street, Suite N-801

Orlando, Florida 32801

For Respondent: Heriberto Alonso, pro se

11336 Southwest 75th Terrace

Miami, Florida 33173

STATEMENT OF THE ISSUE

The issue in this case is whether Respondent, Heriberto

Alonso, violated Section 475.25(1)(b), Florida Statutes (2005-

2006), as alleged in a one-count Administrative Complaint filed

with the Petitioner, Department of Business and Professional

Regulation, and, if so, what disciplinary action should be taken

against his Florida real estate associate license.

PRELIMINARY STATEMENT

On March 17, 2009, a one-count Administrative Complaint,

issued in FDBPR Case No. 2007038214, was filed with Petitioner,

Department of Business and Professional Regulation, against

Respondent, Heriberto Alonso, who holds a Florida real estate

associate license. It is alleged in the Administrative

Complaint that Respondent violated Section 475.25(1)(b), Florida

Statutes (2005-2006).

On or about January 26, 2010, Respondent filed an Election

of Rights form disputing the material facts of the

Administrative Complaint and requesting a formal administrative

hearing.

On January 26, 2010, Petitioner filed the Administrative

Complaint, Respondent’s Election of Rights form, and a letter

requesting that an administrative law judge be assigned to hear

the matter. The request for hearing was designated DOAH Case

No. 10-0389PL and was assigned to the undersigned.

A Notice of Hearing by Video Teleconference was entered

February 4, 2010, scheduling the final hearing for April 2,

2010.

At the final hearing, Petitioner presented the testimony of

Mark Saracino, Suzanne Lloyd, Yvette Murphy, Esquire, Victor

Ulloa, and Doug Dewitt. Petitioner also had admitted

Petitioner’s Exhibits 1 through 17. Mr. Dewitt, Mr. Saracino,

and Ms. Lloyd were also called in rebuttal.

Respondent presented the testimony of Mr. Ulloa and

testified on his own behalf.

The Transcript of the final hearing was filed with the

Division of Administrative Hearings on May 5, 2010. The same

day, a Notice of Filing Transcript was entered informing the

parties of the filing of the Transcript. The parties were also

informed, consistent with their agreement at hearing and the

undersigned’s order, that proposed recommended orders were to be

filed on or before May 21, 2010.

Petitioner filed Petitioner’s Proposed Recommended Order on

May 17, 2010. Respondent filed a one-page letter on April 15,

2010, and on May 24, 2010, filed another one-page letter

suggesting that Petitioner’s post-hearing submittal was filed

late. Respondent’s suggestion is, based upon a review of the

Transcript, incorrect. Accordingly, Petitioner’s Proposed

Recommend Order and Respondent’s first letter have been fully

considered in preparing this Recommended Order.

The events at issue in this case took place throughout

2006. Therefore, the 2005 and 2006 editions of Florida Statutes

apply. There being no material difference between those

editions, all further references to the Florida Statutes in this

Recommended Order are to the 2006 edition, unless otherwise

noted.

FINDINGS OF FACT

A. The Parties .

1. Petitioner, the Department of Business and Professional

Regulation, Division of Real Estate (hereinafter referred to as

Section 20.165, Florida Statutes. The Division is charged with

the responsibility for the regulation of the real estate

industry in Florida pursuant to Chapters 455 and 475, Florida

Statutes.

2. Respondent, Heriberto Alonso, was at the times material

to this matter, the holder of a Florida real estate associate

license, license number 3037527, issued by the Division.

3. At the times relevant, Mr. Alonso was an active sales

associate with The Keyes Company, 690 Lincoln Road No. 300,

Miami Beach, Florida 33139.

B. The “Frow Avenue Property” Listing Agreement .

4. On or about March 9, 2006, Mr. Alonso entered into a

listing agreement with Mark Saracino and Suzanne Lloyd, husband

and wife, whereby Mr. Alonso agreed to list property they owned

located at 106 Frow Avenue, Coral Gables, Florida (hereinafter

referred to as the “Frow Avenue Property”).

5. Pursuant to the listing agreement for the Frow Avenue

Property, the property was to be listed by Mr. Alonso on the MLS

for $359,000.00.

6. Consistent with the listing agreement for the Frow

Avenue Property, the property was listed on the MLS on March 10,

2006, for $359,000.00.

C. The “Thomas Avenue Property” Listing Agreement .

7. On or about March 14, 2006, Mr. Alonso entered into a

listing agreement with Mr. Saracino and Ms. Lloyd, whereby

Mr. Alonso agreed to list property they owned located at 3837

Thomas Avenue, Miami, Florida (hereinafter referred to as the

“Thomas Avenue Property”).

8. Pursuant to the listing agreement for the Thomas Avenue

Property, the property was to be listed by Mr. Alonso on the MLS

for $350,000.00.

9. Consistent with the listing agreement for the Thomas

Avenue Property, the property was listed on the MLS on March 21,

2006, for $350,000.00.

D. Sale of the Frow Avenue and Thomas Avenue Properties .

10. In June of 2006, Ms. Lloyd entered into a sale and

purchase contract with Reinaldo Gonzalez whereby it was agreed

that the Frow Avenue Property would be sold to Mr. Gonzalez for

$329,000.00. At the same time, Mr. Saracino entered into a sale

and purchase contract with Mr. Gonzalez, whereby it was agreed

that the Thomas Avenue Property would be sold to Mr. Gonzalez

for $325,000.00.

11. Without the knowledge or permission of Mr. Saracino

and/or Ms. Lloyd, on July 26, 2006, Mr. Alonso raised the

listing price on each property to $450,000.00.

12. Mr. Saracino and Ms. Lloyd first learned of the

increased listing price when they appeared at the scheduled

closing on the properties and were presented with closing

documents with a sales price on each property of $450,000.00.

On the advice of counsel, Mr. Saracino and Ms. Lloyd refused to

complete the sale of the properties.

13. Mr. Alonso’s testimony to the effect that he disclosed

the increase in the sales price of the properties prior to the

aborted closing is rejected as inconsistent with the credible

testimony of Mr. Saracino and Ms. Lloyd.

E. Cost of Investigation .

14. The cost of investigating this matter totaled

$1,551.00.

CONCLUSIONS OF LAW

A. Jurisdiction .

15. The Division of Administrative Hearings has

jurisdiction over the subject matter of this proceeding and of

the parties thereto pursuant to Sections 120.569 and 120.57(1),

Florida Statutes (2009).

B. The Burden and Standard of Proof .

16. The Division seeks to impose penalties against

Mr. Alonso, pursuant to the Administrative Complaints, that

include the suspension or revocation of his real estate

associate license. Therefore, the Division has the burden of

proving the specific allegations of fact that support its

charges by clear and convincing evidence. See Department of

Banking and Finance, Division of Securities and Investor

Protection v. Osborne Stern and Co. , 670 So. 2d 932 (Fla. 1996);

Ferris v. Turlington , 510 So. 2d 292 (Fla. 1987); and Pou v.

Department of Insurance and Treasurer , 707 So. 2d 941 (Fla. 3d

DCA 1998).

17. What constitutes "clear and convincing" evidence was

described by the court in Evans Packing Co. v. Department of

Agriculture and Consumer Services , 550 So. 2d 112, 116, n. 5

(Fla. 1st DCA 1989), as follows:

. . . [C]lear and convincing evidence

requires that the evidence must be found to

be credible; the facts to which the

witnesses testify must be distinctly

remembered; the evidence must be precise and

explicit and the witnesses must be lacking

in confusion as to the facts in issue. The

evidence must be of such weight that it

produces in the mind of the trier of fact

the firm belief or conviction, without

hesitancy, as to the truth of the

allegations sought to be established.

Slomowitz v. Walker , 429 So. 2d 797, 800

(Fla. 4th DCA 1983).

See also In re Graziano , 696 So. 2d 744 (Fla. 1997); In re

Davey , 645 So. 2d 398 (Fla. 1994); and Walker v. Florida

Department of Business and Professional Regulation , 705 So. 2d

652 (Fla. 5th DCA 1998)(Sharp, J., dissenting).

C. The Charges of the Administrative Complaint .

18. Section 475.25, Florida Statutes, authorizes the

Division to discipline any Florida real estate licensee who

commits any of a number of offenses defined therein. In this

case, the Division has charged Mr. Alonso with having violated

Section 475.25(1)(b), Florida Statutes, which defines the

following offense:

(b) Has been guilty of fraud,

misrepresentation, concealment, false

promises, false pretenses, dishonest dealing

by trick, scheme, or device, culpable

negligence, or breach of trust in any

business transaction in this state or any

other state, nation, or territory; has

violated a duty imposed upon her or him by

law or by the terms of a listing contract,

written, oral, express, or implied, in a

real estate transaction; has aided,

assisted, or conspired with any other person

engaged in any such misconduct and in

furtherance thereof; or has formed an

intent, design, or scheme to engage in any

such misconduct and committed an overt act

in furtherance of such intent, design, or

scheme. It is immaterial to the guilt of the

licensee that the victim or intended victim

of the misconduct has sustained no damage or

loss; that the damage or loss has been

settled and paid after discovery of the

misconduct; or that such victim or intended

victim was a customer or a person in

confidential relation with the licensee or

was an identified member of the general

public. [Emphasis added].

19. In the Administrative Complaint, it has only been

alleged that Mr. Alonso violated the portion of Section

475.25(1)(b), Florida Statutes, highlighted in paragraph 17.

20. In Petitioner’s Proposed Recommended Order, the charge

against Mr. Alonso is further limited; it is argued by

Petitioner that the evidence proved that Mr. Alonso is guilty of

“misrepresentation, concealment and breach of trust” by raising

the listing price of the Frow Avenue and Thomas Avenue

Properties.

21. For there to be “misrepresentation, concealment and

breach of trust” in violation of Section 475.25(1)(b), Florida

Statutes, there must be wrongful intent or scienter. See Munch

v. Department of Professional Regulation , 592 So. 2d 1136, 1143-

44 (Fla. 1st DCA 1992); and Morris v. Department of Professional

Regulation , 474 So. 2d 841, 843 (Fla. 5th DCA 1985).

22. The wrongful intent or scienter required to establish

a violation of Section 475.25(1)(b), Florida Statutes, may be

proven by circumstantial evidence. See , 705 So. 2d at 654; and

Baker v. State , 639 So. 2d 103, 104 (Fla. 5th DCA 1994).

23. In the instant case, the Division established by clear

and convincing evidence that Mr. Alonso engaged in “concealment”

as alleged in the Administrative Complaint. Mr. Alonso, by his

failure to disclose the change in listing price for the

properties, concealed pertinent facts from Mr. Saracino and

Ms. Lloyd, facts they did not learn of until the aborted

closing, and, in so doing, violated Section 475.25(1)(b),

Florida Statutes. Respondent acted knowingly, with the intent

to deceive, in concealing the increase in the sales price of the

Frow Avenue Property from $329,000.00 to $450,000.00 and the

increase in the sales price of the Thomas Avenue Property from

$325,000.00 to $450,000. The Division, however, failed to prove

that Mr. Alonso made any “misrepresentation” to Mr. Saracino or

Ms. Lloyd, or that he committed a “breach of trust.”

D. The Appropriate Penalty .

24. The only issue remaining for consideration is the

appropriate disciplinary action which should be taken by the

Florida Real Estate Commission (hereinafter referred to as the

“Commission”), against Mr. Alonzo for the violation proved by

the Division. To resolve this issue it is necessary to consult

the "disciplinary guidelines" of the Commission set forth in

Florida Administrative Code Chapter 61J2-24. Those guidelines

effectively place restrictions and limitations on the exercise

of the Commission’s disciplinary authority . See Parrot Heads,

Inc. v. Department of Business and Professional Regulation , 741

So. 2d 1231, 1233 (Fla. 5th DCA 1999)("An administrative agency

is bound by its own rules . . . creat[ing] guidelines for

disciplinary penalties."); and § 455.2273(5), Fla. Stat.

25. The penalty guideline for “concealment” committed in

violation of Section 475.25(1)(b), Florida Statutes, is a three

to five year suspension and a fine of $1,000.00. Fla. Admin.

Code R. 61J2-24.001(3)(c).

26. Florida Administrative Code Rule 61J2-24.001(4)

provides for the consideration of certain aggravating and

mitigating circumstances.

27. In Petitioner’s Proposed Recommended Order, it has

been suggested that the recommended penalty should be the

revocation of Mr. Alonso’s license and the payment of a fine of

$1,000. It is argued in Petitioner’s Proposed Recommended Order

that revocation is appropriate due to the apparent “fraudulent”

nature of the matter, of which the increase in the sales price

of the properties was an important step. While it is likely

that fraud was involved, considering this possibility is not

proper for two reasons: Mr. Alonso was not put on notice that

he was being charged with doing anything improper other than

changing an agreed listing price without permission or knowledge

of the sellers; and the evidence was insufficient to prove that

Mr. Alonso was aware of any fraudulent activity.

28. Based upon the foregoing, a suspension of one year,

the payment of a fine of $1,000.00, and payment of the

Division’s cost of investigation, are adequate penalties.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that a final order be entered by the

Commission:

1. Finding that Heriberto Alonso, by his failure to

disclose the change in listing price for the properties, did

conceal pertinent facts from Mr. Saracino and Ms. Lloyd and, in

so doing, violated Section 475.25(1)(b), Florida Statutes; and

2. Suspending his real estate associate’s license for a

period of one year, requiring the payment of a fine of

$1,000.00, and requiring the payment of the Division’s cost of

investigation.

DONE AND ENTERED this 8th day of June, 2010, in

Tallahassee, Leon County, Florida.

LARRY J. SARTIN

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone]

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 8th day of June, 2010.

COPIES FURNISHED :

Heriberto Alonso

11336 Southwest 75th Terrace

Miami, Florida 33173

Jennifer Leigh Blakeman, Esquire

Department of Business &

Professional Regulation

400 West Robinson Street, Suite N-801

Orlando, Florida 32801

Thomas W. O’Bryant, Jr., Director

Division of Real Estate

Department of Business and

Professional Regulation

400 West Robinson Street

Hurston Building-North Tower, Suite N802

Orlando, Florida 32801

Reginald Dixon, General Counsel

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399-0792

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this recommended order. Any exceptions

to this recommended order should be filed with the agency that

will issue the final order in these cases.