10-002463 Department Of Business And Professional Regulation, Construction Industry Licensing Board vs. Harris M. Millman, D/B/A Affiliated Construction Services, Inc.
 Status: Closed
Recommended Order on Friday, August 27, 2010.


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Summary: Unsatis'd judgm't for supplies used in roofing projects and warehouse inventory related to roof'g proff. Violation of 489.129(1)(q). $500 fine & costs. Cont. ed. & requiring proof of satisf. not required for contractor who recognized & tried to pay debt.

1STATE OF FLORIDA

4DIVISION OF ADMINISTRATIVE HEARINGS

8DEPARTMENT OF BUSINESS AND )

13PROFESSIONAL REGULATION, )

16CONSTRUCTION INDUSTRY LICENSING )

20BOARD, )

22)

23Petitioner, )

25)

26vs. ) Case No. 10-2463

31)

32HARRIS M. MILLMAN, d/b/a AFFILIATED CONSTRUCTION )

39SERVICES, INC., )

42)

43)

44Respondent. )

46)

47RECOMMENDED ORDER

49Administrative Law Judge, John D. C. Newton, II, of the

59Division of Administrative Hearings, heard this case, as

67noticed, on July 22, 2010, by video teleconference at sites in

78Miami and Tallahassee, Florida.

82APPEARANCES

83For Petitioner: Paul R. Waters, Esquire

89Department of Business and

93Professional Regulation

951940 North Monroe Street

99Tallahassee, Florida 32399

102For Respondent: Victor Rones, Esquire

107Margulies and Rones, P.A.

11116105 Northeast 18th Avenue

115North Miami Beach, Florida 33162

120STATEMENT OF THE ISSUES

124(1) Does the unsatisfied civil judgment in ABC v Millman

134et al , Case Number 50 2008 CA 006245 XXXX MB relate to practice

147of Respondent’s profession, thus establishing that Respondent,

154Harris M. Millman, violated section 489.129(1), Florida

161Statutes,(2009)?

163(2) If he committed the violation, what penalty should be

173imposed?

174PRELIMINARY STATEMENT

176On January 20, 2010, Petitioner, Department of Business and

185Professional Regulation (Department), filed an Administrative

191Complaint (Complaint) in DBPR Case Number 2009-047490. The

199Complaint alleged that Respondent, Harris M. Millman (Millman),

207d/b/a Affiliated Construction Services, Inc. (Affiliated),

213violated Florida laws regulating his professional activities as

221a certified general and roofing contractor. The Complaint

229charged that Millman violated Section 489.129(1)(q), Florida

236Statutes,(2009) 1 by failing to satisfy, within a reasonable time,

247the terms of a civil judgment obtained against the licensee

257(Millman), or the business organization qualified by the

265licensee (Affiliated), relating to the practice of Millman’s

273profession.

274Millman disputed the allegations and requested a formal

282administrative hearing. The Department referred the case to the

291Division of Administrative Hearings (DOAH) to conduct a hearing

300as provided by Section 120.57, Florida Statutes. DOAH conducted

309the hearing on July 22, 2010, as noticed.

317The Department offered the testimony of Silas McHenry,

325William J. Marell, and Millman. The Department offered eight

334exhibits. All were admitted into evidence.

340Millman testified on his own behalf. He also offered eight

350exhibits. They were admitted into evidence.

356The Department waived making a closing argument. Millman’s

364attorney made a closing argument. Both parties submitted

372Proposed Recommended Orders. Those Proposed Recommended Orders

379and the record in this proceeding have been fully considered in

390preparation of this Recommended Order.

395FINDINGS OF FACT

3981. The Construction Industry Licensing Board has certified

406Millman as a General Contractor and a Roofing Contractor under

416the authority of Chapter 489, Florida Statutes. In 2009 and

4262010, he held license numbers CGC l1522 (General) and CCC

4361327057 (Roofing). Millman’s licenses are presently inactive.

4432. Millman has actively practiced the licensed professions

451of general contractor and roofing contractor in Florida since

4601977. The Department and its predecessor agencies have never

469taken any disciplinary action against him.

4753. At all times material to this proceeding, Affiliated

484was a Construction Qualified Business in the State of Florida,

494certified under Chapter 489, Florida Statutes, holding license

502number QB45287.

5044. Millman was the Primary Qualifying Agent for Affiliated

513under Chapter 489, Florida Statutes, at all times material to

523this proceeding.

5255. On December 26, 2005, Millman signed a credit

534application with American Builders and Contractors Supply

541Company, Inc., d/b/a ABC Supply Co. Inc. (ABC), on behalf of

552Affiliated.

5536. Millman listed his Certified General Contractor’s

560License (CGC 011522) on the credit application and personal

569guarantee

5707. Although Millman provided his General Contractor’s

577license number on the application, ABC did not require a license

588number.

5898. The application indicates that the account is related

598to “low and steep slope roofing.” The account was for the

609purchase of roofing materials and supplies.

6159. On December 29, 2005, Millman signed a personal

624guarantee of the Affiliated account with ABC.

63110. Millman’s personal guarantee made him personally

638liable for Affiliated’s obligation to pay ABC.

64511. ABC granted the application and opened a line of

655credit for Millman and Affiliated.

66012. Millman and Affiliated used the account to purchase

669roofing supplies on credit. They purchased and paid for over

679$800,000 worth of supplies from 2006 into 2009. This is

690separate from the goods and materials that were the subject of

701the lawsuit described below.

70513. Most of the materials and supplies that Affiliated

714purchased on the ABC account were for specific roofing projects.

724But some, as Millman acknowledged in his testimony, were to

734maintain roofing materials in the Affiliated warehouse. He used

743these on small jobs and to supplement materials purchased for

753larger, specific jobs. All the goods and materials purchased

762related to Millman’s practice of the roofing contracting

770profession.

77114. In 2007 Millman and Affiliated started having

779financial difficulties. Millman’s business began failing.

78515. The failure of a lender that took over a construction

796project it was financing resulted in the lender not paying

806Millman for approximately $500,000 worth of his company’s work.

816This contributed to Millman’s business failure. In addition to

825Millman’s problems paying ABC, his landlord was evicting him.

83416. Millman worked hard during these difficulties to meet

843his obligations to ABC. He liquidated his Individual Retirement

852Account and his life savings to make sure he paid for all

864charges for supplies used for specified customers. He did this

874to protect customers from the risk of liens being placed on

885their properties.

88717. Millman advised ABC that he was being evicted from his

898warehouse. He told ABC that the warehouse contained materials

907obtained with his line of credit that had not been paid for.

919Millman did not have the ability to return the materials to ABC.

931As eviction neared, he urged ABC to retrieve the materials

941before eviction. ABC did not act to retrieve the materials.

951The landlord evicted Millman. What happened to the materials is

961not known.

96318. On March 4, 2008, ABC sued Millman and Affiliated in

974the Circuit Court of the Fifteenth Judicial Circuit in and for

985Palm Beach County, Florida. ABC sought payment for goods and

995materials purchased on the account and delivered to Millman and

1005Affiliated between January 31, 2007, and January 31, 2008. The

1015court assigned the action Case Number 50 2008 CA 006245 XXXX MB.

102719. The goods and materials for which ABC sought payment

1037were roofing goods and materials. They included roofing felt,

1046roofing cement, shingles, plywood, lumber, roofing nails, lead

1054sheets, insulation, roof tile cement, lead boots for pipes,

1063roofing paint, asphalt, and galvanized roof edging. Much,

1071although not all, of the material was delivered to roof tops.

1082Many invoices for the material describe the roof for which the

1093material is intended by height and pitch. The goods and

1103materials related to Millman’s profession of roofing contractor.

111120. On June 17, 2008, barely three months after ABC filed

1122suit, Millman entered into a Stipulation for Payment with

1131Judgment upon Default with ABC. Millman agreed in the

1140Stipulation for Payment with Judgment upon Default, that both he

1150as an individual and Affiliated are indebted to ABC in the

1161amount of $45,617.02. This amount included interest, attorney’s

1170fees, and costs.

117321. The stipulation included a schedule of eight payments

1182starting with a payment of $2,500.00 on May 30, 2008, and ending

1195with a payment of $22,720.02 on December 30, 2008.

120522. Millman made payments from January 1, 2007, forward,

1214even during and after the collection litigation. Millman made

1223over $16,000.00 of those payments. But he did not make all of

1236them.

123723. As Millman made payments, he took care to designate

1247payments for supplies allocated to a specific customer and job.

1257He did this to protect his customers from liens and to make sure

1270that documents he signed attesting that supplies for specific

1279jobs had been paid for were honest and correct.

128824. On August 3, 2009, the court rendered a Final Judgment

1299After Stipulation in ABC’s collection action. The court

1307adjudged that ABC recover $29,617.02 together with interest at

1317the rate of 11 percent per annum accruing from May 31, 2008,

1329from Affiliated and Millman, jointly and severally.

133625. The judgment is for debt incurred relating to

1345Millman’s practice of his licensed profession of roofing

1353contracting. It is not related to Millman’s licensed profession

1362of general contracting.

136526. ABC continued to actively pursue collecting the

1373judgment. It garnished Millman’s bank account with Bank

1381Atlantic and obtained $662.61.

138527. Millman and Affiliated have not fully satisfied the

1394judgment within a reasonable period of time.

140128. The Department incurred $216.00 in costs for the

1410investigation and this action.

1414CONCLUSIONS OF LAW

141729. Section 120.57, Florida Statutes, grants DOAH

1424jurisdiction over the parties and subject matter of this

1433proceeding.

143430. Florida law, through Section 20.165 and Chapters 455

1443and 489, Florida Statutes, charges the Department and the

1452Construction Industry Licensing Board with regulating the

1459practice of contracting.

146231. Section 489.129, Florida Statutes, empowers the Board

1470to revoke, suspend or otherwise discipline the license of a

1480contractor who is found guilty of any of the offenses enumerated

1491in Section 489.129(1), Florida Statutes.

149632. The Department must prove Millman’s alleged violations

1504with clear and convincing evidence. § 120.57(1)(j), Florida

1512Statutes; Ferris v. Turlington , 510 So. 2d. 292 (Fla. 1987);

1522Department of Banking and Finance v. Osborne Stern and Co. , 670

1533So. 2d 932 (Fla. 1996).

153833. Clear and convincing evidence must be credible. The

1547memories of witnesses must be clear and not confused. The

1557evidence must produce a firm belief that the truth of the

1568allegations has been established. Slomowitz v. Walker , 429 So.

15772d 797, 800 (Fla. 4th DCA 1983). Evidence that conflicts with

1588other evidence may be clear and convincing. The trier of fact

1599must resolve conflicts in the evidence. G.W.B. v. J.S.W. (in Re

1610Baby E.A.W.) , 658 So. 2d 961, 967 (Fla. 1995).

161934. Clear and convincing evidence proved all of the

1628Findings of Fact in this Recommended Order.

163535. The administrative complaint alleges that Millman

1642violated Section 489.129(1)(q), Florida Statutes. That section

1649permits the Department to take action against a certificate

1658holder or registrant such as Millman for:

1665Failing to satisfy within a reasonable time,

1672the terms of a civil judgment obtained

1679against the licensee, or the business

1685organization qualified by the licensee,

1690relating to the practice of the licensee’s

1697profession.

169836. Florida Administrative Code Rule 6IG4-17.001(1)(q),

1704defines reasonable time as 90 days following the entry of a

1715civil judgment that is not appealed.

172137. The Department proved by clear and convincing evidence

1730that Millman violated Section 489.129(1)(q), Florida Statutes.

173738. Section 489.129(1), Florida Statutes, permits the

1744Construction Industry Licensing Board to impose a range of

1753penalties for a violation of Section 489.129(q), Florida

1761Statutes. They include a fine not exceeding $10,000 per

1771violation, requiring continuing education, assessing costs, and

1778financial restitution to a consumer, license revocation, and

1786license suspension.

178839. Florida Administrative Code Rule 61G4-17.001

1794establishes disciplinary guidelines and recognizes that

1800aggravating and mitigating circumstances may be considered.

180740. Florida Administrative Code Rule 61G4-17.002 lists

1814aggravating and mitigating circumstances as follows:

1820Circumstances which may be considered for

1826the purposes of mitigation or aggravation of

1833penalty shall include, but are not limited

1840to, the following:

1843(1) Monetary or other damage to the

1850licensee’s customer, in any way associated

1856with the violation, which damage the

1862licensee has not relieved, as of the time

1870the penalty is to be assessed. (This

1877provision shall not be given effect to the

1885extent it would contravene federal

1890bankruptcy law.)

1892(2) Actual job-site violations of building

1898codes, or conditions exhibiting gross

1903negligence, incompetence, or misconduct by

1908the licensee, which have not been corrected

1915as of the time the penalty is being

1923assessed.

1924(3) The danger to the public.

1930(4) The number of complaints filed against

1937the licensee.

1939(5) The length of time the licensee has

1947practiced.

1948(6) The actual damage, physical or

1954otherwise, to the licensee's customer.

1959(7) The deterrent effect of the penalty

1966imposed.

1967(8) The effect of the penalty upon the

1975licensee's livelihood.

1977(9) Any efforts at rehabilitation.

1982(10) Any other mitigating or aggravating

1988circumstances.

198941. The Department did not prove any aggravating

1997circumstances. No customers were damaged. This is the only

2006complaint ever filed against Millman. There are no jobsite code

2016violations. There are no indications of gross negligence,

2024incompetence, or misconduct. There is no danger to the public.

203442. The facts establish several mitigating circumstances.

2041In 33 years of business, this is the only complaint against

2052Millman. His failure to fully satisfy the judgment is not

2062deliberate or the consequence of reckless or negligent actions.

2071All along, from before the civil lawsuit to the final hearing in

2083this matter, Millman has accepted responsibility for his debt

2092and attempted to satisfy it. He communicated with ABC, keeping

2102it informed about his financial problems and his efforts to pay.

2113Millman worked to minimize the effect of his financial problems

2123and his inability to pay the debt on his customers and on ABC.

2136He did everything that he could do to make sure obligations

2147linked to a specific job were satisfied to protect the customer.

2158Millman also advised ABC that he was being evicted and urged it

2170to recover the materials that were purchased with the

2179uncollected debt so that it could mitigate its damages. His

2189efforts amount to vigorous rehabilitation.

219443. For the offenses that Millman has committed, the

2203penalty range established by the rule for a first offense is a

2215$500.00 fine and/or proof of satisfaction of the judgment up to

2226a maximum of a $5,000 fine and/or proof of satisfaction of the

2239civil judgment. Fla. Admin. Code R. 61G4-17.001(1)(q).

224644. The Department seeks a fine of $5,000.00. That is not

2258supported in a case where there are no aggravating circumstances

2268and there are many mitigating circumstances. In light of the

2278mitigating circumstances and the lack of aggravating

2285circumstances, a fine of $500.00 is appropriate.

229245. The Department also seeks a requirement that Millman

2301must provide proof that he has satisfied the judgment. 2 The

2312facts do not support this requirement.

231846. ABC has demonstrated the ability and willingness to

2327use the many legal tools available to it to satisfy the

2338judgment. Millman has demonstrated that he accepts the duty to

2348pay and will strive to pay to the best of his ability. The

2361facts do not demonstrate the need for the Board and the

2372Department to remain involved in this commercial collection

2380matter.

238147. The Department also seeks a requirement that Millman

2390complete seven additional hours of “live continuing education

2398with an emphasis on Chapter 489, Florida Statutes.” Florida

2407Administrative Code Rule 61G4-17.001(2) provides that the Board

2415shall require continuing education when the nature of the charge

2425or the facts indicate that the licensee lacks understanding of

2435the laws and rules governing the profession.

244248. The facts do not indicate that Millman lacked

2451understanding of the laws and rules governing his profession.

2460Nothing inherent in the charge identifies a lack of

2469understanding of the laws and rules governing the profession.

2478Millman was aware of the governing laws and rules and did his

2490best to comply. One example is his efforts to do everything he

2502could to protect his customers from the risk of a “lien.”

2513Another example is the fact that Millman acknowledged his

2522responsibilities and sought to fulfill them as best as he could

2533in the midst of the financial problems. The very quick

2543resolution of the lawsuit by stipulation is one demonstration of

2553this.

255449. The discipline imposed must be limited to the licensed

2564profession to which the judgment is related. The statute must

2574be strictly construed on account of being a penal statute.

2584Camejo v. Dept. of Bus. & Prof’l Regulation , 812 So. 2d 583

2596(Fla. 3rd DCA, 2002). Consequently, the Construction Industry

2604Licensing Board may only impose sanctions on Millman’s roofing

2613contractor license. The Department did not prove by clear and

2623convincing evidence that the unsatisfied judgment relates to

2631Millman’s practice of General Contracting.

263650. The Department seeks payment of costs of $216.00.

2645This payment is supported.

2649RECOMMENDATION

2650Based on the foregoing Findings of Fact and Conclusion of

2660Law, it is recommended that the Department of Business and

2670Professional Regulation, Construction Industry Licensing Board,

2676enter a final order finding that Respondent, Harris M. Millman,

2686violated Section 489.129(1)(q), Florida Statutes, and imposing

2693the following penalties:

26961. Payment of an administrative fine of $500.00 within 180

2706days of entry of the final order.

27132. Payment of costs of investigation and prosecution in

2722the amount of $216.00 within 180 days of entry of the final

2734order.

2735DONE AND ENTERED this 27th day of August, 2010, in

2745Tallahassee, Leon County, Florida.

2749S

2750JOHN D. C. NEWTON, II

2755Administrative Law Judge

2758Division of Administrative Hearings

2762The DeSoto Building

27651230 Apalachee Parkway

2768Tallahassee, Florida 32399-3060

2771(850) 488-9675

2773Fax Filing (850) 921-6847

2777www.doah.state.fl.us

2778Filed with the Clerk of the

2784Division of Administrative Hearings

2788this 27th day of August, 2010.

2794ENDNOTES

27951/ All references to Florida Statutes in this order are to 2009

2807unless otherwise specified.

28102/ Although the rule identifies requiring proof of satisfaction

2819of the judgment as a penalty, Section 489.129(1), Florida

2828Statutes, does not. It provides only for probation, reprimand,

2837revocation, suspension, financial restitution to a consumer for

2845financial harm directly related to a violation of a provision of

2856this part, an administrative fine not to exceed $10,000 per

2867violation, requiring continuing education, and assessing costs.

2874Restitution is not available in this case because ABC is not a

2886“consumer.” Jonas v. Florida Dept. of Bus. & Prof’l Regulation ,

2896746 So. 2d 1261 (Fla. 3rd DCA, 2000).

2904COPIES FURNISHED :

2907Paul R. Waters, Esquire

2911Department of Business and

2915Professional Regulation

29171940 North Monroe Street

2921Tallahassee, Florida 32399

2924Victor Rones, Esquire

2927Margulies and Rones, P.A.

293116105 Northeast 18th Avenue

2935North Miami Beach, Florida 33162

2940Reginald Dixon, General Counsel

2944Department of Business and

2948Professional Regulation

2950Northwood Centre

29521940 North Monroe Street

2956Tallahassee, Florida 32399-0792

2959G. W. Harrell, Executive Director

2964Construction Industry Licensing Board

2968Department of Business and

2972Professional Regulation

2974Northwood Centre

29761940 North Monroe Street

2980Tallahassee, Florida 32399-0792

2983NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

2989All parties have the right to submit written exceptions within

299915 days from the date of this Recommended Order. Any exceptions

3010to this Recommended Order should be filed with the agency that

3021will issue the Final Order in this case.

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Date
Proceedings
PDF:
Date: 08/27/2010
Proceedings: Recommended Order
PDF:
Date: 08/27/2010
Proceedings: Recommended Order (hearing held July 22, 2010). CASE CLOSED.
PDF:
Date: 08/27/2010
Proceedings: Recommended Order cover letter identifying the hearing record referred to the Agency.
PDF:
Date: 08/09/2010
Proceedings: Petitioner's Proposed Recomended Order filed.
Date: 08/06/2010
Proceedings: Transcript of Proceedings filed.
PDF:
Date: 07/30/2010
Proceedings: (Respondent`s Proposed) Recommended Order filed.
Date: 07/22/2010
Proceedings: CASE STATUS: Hearing Held.
PDF:
Date: 07/20/2010
Proceedings: Petitioner's Exhibits (exhibits not available for viewing) filed.
PDF:
Date: 07/20/2010
Proceedings: Complaint for Breach of Lease and Breach of Guaranty filed.
PDF:
Date: 07/20/2010
Proceedings: Final Judgment filed.
PDF:
Date: 07/20/2010
Proceedings: Agreed Final Judgment filed.
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Date: 07/20/2010
Proceedings: Agreed Final Judgment on Attorney's Fees filed.
PDF:
Date: 07/20/2010
Proceedings: Letter to Affiliated Construction from William Marell regarding purchased materials from ABC Supply filed.
PDF:
Date: 07/20/2010
Proceedings: Final Judgment of Garnishment filed.
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Date: 07/20/2010
Proceedings: Respondent's Corporate Records (exhibits not available for viewing) filed.
PDF:
Date: 07/08/2010
Proceedings: Petitioner's Corrected Exhibit List (exhibits not attached) filed.
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Date: 07/08/2010
Proceedings: Petitioner's Exhibit List (exhibits not attached) filed.
PDF:
Date: 07/07/2010
Proceedings: Joint Pre-hearing Stipulation filed.
PDF:
Date: 07/06/2010
Proceedings: Notice of Court Reporter filed.
PDF:
Date: 05/26/2010
Proceedings: Petitioner's First Request for Production to Respondent filed.
PDF:
Date: 05/26/2010
Proceedings: Petitioner's Response to Respondent's First Request for Admissions to Petitioner filed.
PDF:
Date: 05/24/2010
Proceedings: Petitioner's Second Request for Admissions to Respondent filed.
PDF:
Date: 05/24/2010
Proceedings: Petitioner's Notice of Serving Subpoena Duces Tecum (to Attorney William Marell) filed.
PDF:
Date: 05/20/2010
Proceedings: Petitioner's Notice of Serving Subpoena Duces Tecum (to American Buildings & Contractors Supply Company, Inc.) filed.
PDF:
Date: 05/20/2010
Proceedings: Response to Petitioner's Motion to Relinquish Jurisdiction filed.
PDF:
Date: 05/20/2010
Proceedings: Response to Initial Order filed.
PDF:
Date: 05/19/2010
Proceedings: Order Directing Filing of Exhibits
PDF:
Date: 05/19/2010
Proceedings: Order of Pre-hearing Instructions.
PDF:
Date: 05/19/2010
Proceedings: Notice of Hearing by Video Teleconference (hearing set for July 22, 2010; 1:00 p.m.; Miami and Tallahassee, FL).
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Date: 05/19/2010
Proceedings: Order Denying Motion to Relinquish Jurisdiction.
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Date: 05/17/2010
Proceedings: Response to Petitioner's Motion to Relinquish Jurisdiction filed.
PDF:
Date: 05/17/2010
Proceedings: Response to Initial Order filed.
PDF:
Date: 05/12/2010
Proceedings: Petitioner's Response to Initial Order filed.
PDF:
Date: 05/11/2010
Proceedings: Petitioner's Motion to Relinquish Jurisdiction Based on no Genuine Issue of Material Fact filed.
PDF:
Date: 05/11/2010
Proceedings: Notice of Service of Interrogatories filed.
PDF:
Date: 05/11/2010
Proceedings: Petitioner's First Request for Admissions to Respondent filed.
PDF:
Date: 05/10/2010
Proceedings: Initial Order.
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Date: 05/07/2010
Proceedings: Agency referral filed.
PDF:
Date: 05/07/2010
Proceedings: Response to Administrative Complaint Disputed Issues of Fact filed.
PDF:
Date: 05/07/2010
Proceedings: Administrative Complaint filed.
PDF:
Date: 05/07/2010
Proceedings: Election of Rights filed.

Case Information

Judge:
JOHN D. C. NEWTON, II
Date Filed:
05/07/2010
Date Assignment:
05/10/2010
Last Docket Entry:
08/27/2010
Location:
Miami, Florida
District:
Southern
Agency:
Department of Business and Professional Regulation
 

Counsels

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