97-002549 Division Of Real Estate vs. Lynton Oliver Thomas And L T Express Realty Corporation Status: Closed Recommended Order on Tuesday, November 18, 1997.

Summary: Real estate broker closed office and left state without accounting for escrowed funds. Revocation recommended.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case No. 97-2549

)

LYNTON OLIVER THOMAS and )

L T EXPRESS REALTY CORP., )

)

Respondents. )

__________________________________)

RECOMMENDED ORDER

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

on September 22, 1997, by video, in Tallahassee, Florida, and in

Miami, Florida, before Claude B. Arrington, a duly designated

Administrative Law Judge of the Division of Administrative

Hearings.

APPEARANCES

For Petitioner: Daniel Villazon, Esquire

Department of Business and

Professional Regulation

400 West Robinson Street

Post Office Box 1900

Orlando, Florida 32802

For Respondent: No appearance.

STATEMENT OF THE ISSUES

Whether the Respondents committed the offenses alleged in

the Administrative Complaint and, if so, the penalties that

should be imposed.

PRELIMINARY STATEMENT

At all times pertinent to this proceeding, Respondent,

Lynton Oliver Thomas, was licensed by Petitioner as a real estate

broker, and L T Express Realty Corp. was the corporate entity

licensed by Petitioner through which Mr. Thomas conducted his

real estate business. The Administrative Complaint filed by

Petitioner against Respondents on July 19, 1996, contained eight

counts. Based on facts alleged in the Administrative Complaint

Petitioner charged Mr. Thomas (in the odd-numbered counts) and

his corporation (in the even-numbered counts) as follows: Counts

I and II with violating Section 475.25(1)(b), Florida Statutes;

Counts III and IV with violating Rule 61J2-10.032(1), Florida

Administrative Code, and Section 475.25(1)(e), Florida Statutes;

Counts V and VI with Rule 61J2-10.022, Florida Administrative

Code, and Section 475.25(1)(e), Florida Statutes; and in Counts

VII and VIII with violating Section 475.25(1)(k), Florida

Statutes.

Respondents timely requested a formal administrative hearing

to contest the allegations of the Administrative Complaint, and

the matter was referred to the Division of Administrative

Hearings, and this proceeding followed.

At the formal hearing, the Petitioner presented the

testimony of Patrick Killen, Marie Suzette Saintel, and Kenneth

Rehm. Mr. Killen is a real estate broker who was involved in the

transaction that underlies this proceeding, and Ms. Saintel was

one of the parties to that transaction. Mr. Rhem is an

investigator employed by Petitioner. Petitioner presented two

exhibits, both of which were admitted into evidence. Although

this proceeding had been duly noticed for hearing, Respondent did

not appear at the formal hearing.

A transcript of the proceedings has been filed. The

Petitioner filed a proposed recommended order, which has been

duly considered by the undersigned in the preparation of this

Recommended Order. Respondent did not file a post-hearing

submittal.

FINDINGS OF FACT

1. Petitioner is the state licensing and regulatory agency

charged with the responsibility and duty to regulate the practice

of real estate, pursuant to the laws of the State of Florida.

2. At all times pertinent to this proceeding, Respondent,

Lynton Oliver Thomas, was a licensed real estate broker, having

been issued license number 0504596 in accordance with

Chapter 475, Florida Statutes.

3. The last license issued to Respondent Thomas was as a

broker-salesperson at Pagliari Realty, Inc., 323 Northeast

167 Street, North Miami Beach, Florida 33162.

4. At all times pertinent to this proceeding, Respondent,

L T Express Realty Corp., was a corporation registered as a

Florida real estate broker, having been issued license number

0273473 in accordance with Chapter 475, Florida Statutes.

5. At all times pertinent to this proceeding, Respondent

Thomas was licensed and operating as qualifying broker and

officer of Respondent L T Express Realty Corp. The office for

this corporate entity was located at 2124 Northeast 123 Street,

North Miami Beach, Florida. There was no evidence that

Respondent Thomas operated his corporate entity from any other

office.

6. On May 7, 1995, Respondent Thomas, a licensed real

estate broker, d/b/a L T Express Realty Corp., negotiated a

contract for the sale of a house between Bruce and Ann McCormick

(as sellers) and Marie S. Saintel and Carita Luc (as buyers).

7. The buyers gave Respondent Thomas an earnest money

deposit in the amount of $5,528.00.

8. The transaction failed to close.

9. The sellers, through their agent, attempted to make a

demand upon Respondent Thomas for delivery of the earnest money

deposit. The sellers' agent was unable to serve the demand on

the Respondents because the Respondents had closed their offices

and could not be located. Respondents had, or should have had, a

good faith doubt as to the proper way to disburse the escrowed

funds.

10. Respondent Thomas, without authorization from the

sellers, returned $3,000.00 of the original $5,528.00 deposit to

the buyers. The balance of the earnest money deposit, in the

amount of $2,528.00, has not been recovered from the Respondents.

Rule 61J2-10.032(1), Florida Administrative Code, provides the

procedure real estate brokers are required to follow when

competing demands are made for funds that have been received in

escrow or when a broker has a good faith doubt as to how escrowed

funds should be disbursed. At no time did Respondents attempt to

invoke those procedures.

11. Kenneth G. Rehm, Petitioner's investigator, visited

Respondent L T Express Realty Corp. and discovered that

Respondent Thomas had abandoned his registered office.

12. Respondent Thomas failed to notify Petitioner that he

closed his real estate office at 2124 Northeast 123 Street, North

Miami Beach, Florida.

CONCLUSIONS OF LAW

13. The Division of Administrative Hearings has

jurisdiction of the parties to and the subject of this

proceeding. Section 120.57(1), Florida Statutes.

14. The Petitioner has the authority to bring this

disciplinary action against Respondents pursuant to the

provisions of Chapter 475, Florida Statutes.

15. Section 475.25, Florida Statutes (1995), provides that

the Florida Real Estate Commission may suspend a license for a

period not exceeding ten (10) years; revoke a real estate

license; may impose an administrative fine not to exceed $1,000

for each count or separate offense; and may impose a reprimand

or, any or all of the foregoing, if it finds that a licensee has

violated Sections 475.25(1)(b), (k), or (e), Florida Statutes.

16. Petitioner has the burden of proving by clear and

convincing evidence the allegations against Respondents. See

Ferris v. Turlington , 510 So. 2d 292 (Fla. 1987); Evans Packing

Co. v. Department of Agriculture and Consumer Services , 550

So. 2d 112 (Fla. 1st DCA 1989).

17. Section 475.25, Florida Statutes, provides, in

pertinent part, as follows:

(1) The commission may deny an application

for licensure, registration, or permit, or

renewal thereof; may place a licensee,

registrant, or permittee on probation; may

suspend a license, registration, or permit

for a period not exceeding 10 years; may

revoke a license, registration, or permit;

may impose an administrative fine not to

exceed $1,000 for each count or separate

offense; and may issue a reprimand, and any

or all of the foregoing, if it finds that the

licensee, registrant, permittee, or

applicant:

* * *

(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 him by law or by

the terms of a listing contract, written,

oral, express, or implied, in a real estate

transaction. . . .

* * *

(e) Has violated any of the provisions of

this chapter or any lawful order or rule made

or issued under the provisions of this

chapter or chapter 455.

* * *

(k) Has failed, if a broker, to

immediately place, upon receipt, any money,

fund, deposit, check, or draft entrusted to

him by any person dealing with him as a

broker in escrow with a title company,

banking institution, credit union, or savings

and loan association located and doing

business in this state, or to deposit such

funds in a trust or escrow account maintained

by him with some bank, credit union, or

savings and loan association located and

doing business in this state, wherein the

funds shall be kept until disbursement

thereof is properly authorized. . . .

18. Petitioner established by clear and convincing evidence

that Respondents violated the provisions of Section 475.25(1)(b),

Florida Statutes, as alleged in Counts I and II of the

Administrative Complaint. There remains missing from the funds

that were deposited with Respondents the sum of $2,528.00. The

failure to account for those funds, at a minimum, establishes

culpable negligence and breach of trust in a business transaction

within the meaning of Section 475.25(1)((b), Florida Statutes.

As argued by Petitioner, the conclusion that Respondent absconded

with the missing money is inescapable in the absence of a

plausible explanation to the contrary.

19. Petitioner established by clear and convincing evidence

that Respondents should have invoked the provisions of Rule 61J2-

10.032(1), Florida Administrative Code, to properly disburse the

escrowed funds. The failure of these Respondents to follow the

procedures set forth in Rule 61J2-10.032(1), Florida

Administrative Code, constitutes a violation of Section

475.25(1)(e), Florida Statutes, as alleged in Counts III and IV

of the Administrative Complaint.

20. Rule 61J2-10.022, Florida Administrative Code, requires

a broker to have an office and to register that office with the

Petitioner. The failure to comply with that rule is a violation

of Section 475.25(1)(e), Florida Statutes. Petitioner

established by clear and convincing evidence that Respondents

violated that rule, thereby violating that statutory provision,

as alleged in Counts V and VI of the Administrative Complaint.

21. Counts VII and VIII alleged that the Respondents failed

to maintain the escrowed funds in an escrow account until

disbursement was properly authorized in violation of Section

475.25(1)(k), Florida Statutes. Petitioner established those

violations by clear and convincing evidence.

22. Petitioner correctly asserts in its post-hearing

submittal that revocation of licensure is the appropriate penalty

for these serious violations. No administrative fine is being

recommended because Petitioner did not include an administrative

fine in the disposition portion of its Proposed Recommended

Order.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that a Final Order be entered that finds

Respondents guilty of the violations alleged in Counts I-VIII of

the Administrative Complaint. As a penalty for these violations,

the Final Order should revoke all licenses issued by Petitioner

to Respondents.

DONE AND ENTERED this 18th day of November, 1997, in

Tallahassee, Leon County, Florida.

___________________________________

CLAUDE B. ARRINGTON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing (9 04) 921-6847

Filed with the Clerk of the

Division of Administrative Hearings

this 18th day of November, 1997

COPIES FURNISHED:

Daniel Villazon, Esquire

Department of Business and

Professional Regulation

Division of Real Estate

Post Office Box 1900

Orlando, Florida 32802-1900

Mr. Lynton Oliver Thomas

L T Express Realty Corp.

10810 Northeast Tenth Place

Miami, Florida 33161

Henry M. Solares, Division Director

Division of Real Estate

Post Office Box 1900

Orlando, Florida 32802-1900

Lynda L. Goodgame, General Counsel

Department of Business and

Professional Regulation

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 this case.