97-005041 Division Of Real Estate vs. Mizeral Robinson And Wakefield Realty, Inc. Status: Closed Recommended Order on Friday, May 29, 1998.

Summary: Broker failed to account for and deliver deposit when due, and failed to maintain or produce records to account for deposit. Revocation of licensure recommended.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case Nos. 97-5041

) 98-0003

MIZERAL ROBINSON and WAKEFIELD )

REALTY, INC., )

)

Respondents. )

__________________________________)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings,

by its duly designated Administrative Law Judge, William J.

Kendrick, held a formal hearing in the above-styled case on

March 25, 1998, by video teleconference.

APPEARANCES

For Petitioner: Geoffrey T. Kirk, Esquire

Department of Business and

Professional Regulation

Division of Real Estate

Post Office Box 1900

Orlando, Florida 32802-1900

For Respondents: Donnette Reid, Esquire

Law Offices of Glantz & Glantz

Wellesley Corporate Plaza

7951 Southwest Sixth Street, Suite 200

Plantation, Florida 33324

STATEMENT OF THE ISSUES

At issue in this proceeding is whether Respondents committed

the offenses set forth in the Administrative Complaints and, if

so, what penalty should be imposed.

PRELIMINARY STATEMENT

On August 21, 1997, Petitioner issued a five-count

Administrative Complaint against Respondents, Mizeral Robinson

("Robinson") and Wakefield Realty, Inc. (Wakefield Realty), for

perceived violations of Section 475.25, Florida Statutes. The

gravamen of the complaint concerns a $6,000 deposit which, it is

alleged, Hubert and Ruth Dobson (the "Buyers") placed with

Respondents under the terms of a deposit receipt agreement and

which Robinson (Count I) and Wakefield Realty (Count II) failed

to account for and deliver, in violation of Section 475.25(1)(d),

Florida Statutes. The complaint further alleges that, during the

Department's investigation of the Dobson transaction, Robinson

(Count III) and Wakefield Realty (Count IV) "failed or were

unable to produce to Petitioner's investigator, upon request, the

requisite brokerage records and documentation," in violation of

Rule 61J2-14.012, Florida Administrative Code, and, therefore, in

violation of Section 475.25(1)(e), Florida Statutes. Finally,

the complaint alleges (Count V) that, at the time the complaint

was issued, Wakefield Realty did not have a duly licensed

qualifying broker and had, therefore, failed to maintain an

active, valid and current corporate registration, in violation of

Rule 61J2-5.018, Florida Administrative Code, and, therefore, in

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

On November 20, 1997, Petitioner issued a second

Administrative Complaint against Respondent Robinson for

additional perceived violations of Section 475.25, Florida

Statutes. The gravamen of this complaint was a $1,000 deposit by

Iran V. Rafiee (the "Buyer"), which Petitioner alleged Robinson

failed to timely deposit in escrow, and failed to account for and

deliver. The complaint further alleged that Robinson "failed to

properly and timely notify Petitioner of any change of address or

employer as required by law," and that "Respondent is presently

licensed as a broker-salesperson without being properly

affiliated with any duly licensed or registered Florida real

estate broker." The complaint concluded, based on such

allegations, that Robinson was guilty of the following offenses:

Count I, "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 in violation of § 475.25(1)(b), Fla.

Stat."; Count II, "failing to immediately deposit funds in escrow

in violation of § 475.25(1)(k), Fla. Stat."; Count III, "failing

to account and deliver funds held in escrow, trust or on

condition in violation of § 475.25(1)(d), Fla. Stat."; Count IV,

"failing to properly and timely notify Petitioner of a change of

address or employer in violation of § 475.23, Fla. Stat.," and

"operating as a broker without an active, current and valid

Florida brokers license, either or both in violation of

§ 475.25(1)(a)/(e), Fla. Stat."; and, Count V, "failure to

maintain trust funds in the real estate brokerage escrow bank

account or some other proper depository until disbursement

thereof was properly authorized in violation of § 475.25(1)(k),

Fla. Stat."

Respondent filed an election of rights in response to each

complaint which raised disputed issues of fact, and the matters

were referred to the Division of Administrative Hearings for the

assignment of an administrative law judge to conduct a formal

hearing pursuant to Sections 120.569 and 120.57(1), Florida

Statutes. The first Administrative Complaint, dated August 21,

1997, was assigned DOAH Case No. 97-5041, and the second

Administrative Complaint, dated November 20, 1997, was assigned

DOAH Case No. 98-0003. By order of January 22, 1998, the cases

were consolidated.

At hearing, Petitioner called as witnesses Iran Rafiee,

Juanita Palacio, Ruth Dobson, Hubert Dobson, and Monroe Berger.

Petitioner's Exhibits 2 through 24 were received into evidence. 1

Respondent Mizeral Robinson testified on her own behalf, and

Respondent's Exhibits 1 through 8 were received into evidence. 2

The transcript of hearing was filed April 15, 1998, and the

parties were initially accorded ten days from that date to file

proposed recommended orders. Thereafter, at Respondents' request

and with Petitioner's acquiescence, the time for filing proposed

recommended orders was extended to May 15, 1998. Consequently,

the parties waived the requirement that a recommended order be

rendered within thirty days after the transcript is filed. Rule

60Q-2.011, Florida Administrative Code. Petitioner elected to

file such a proposal, and it has been duly considered in the

preparation of this order.

FINDINGS OF FACT

Preliminary matters

1. Petitioner, Department of Business and Professional

Regulation, Division of Real Estate (Department), is a state

government licensing and regulatory agency charged, inter alia ,

with the responsibility and duty to prosecute administrative

complaints pursuant to the laws of the State of Florida,

including Chapters 455 and 475, Florida Statutes.

2. Respondent, Mizeral Robinson (Robinson), is now and was

at all times material hereto a licensed real estate broker in the

State of Florida, having been issued license number 0484257.

3. From July 18, 1988, through January 5, 1997, Robinson

was registered with the Department as a broker/officer of

Wakefield Realty, Inc. (Wakefield Realty), a broker-corporation,

and from January 6, 1997, through June 30, 1997, Robinson was

registered as an active broker-salesperson with Township Realty,

Inc., a broker-corporation located at 1333 South State Road 7,

North Lauderdale, Florida. Since June 30, 1997, Robinson has

been registered as a broker-salesperson without a current

employer, with an address of 6372 Harbor Bend, Margate, Florida.

4. From July 18, 1988, through January 6, 1997, Wakefield

Realty was registered with the Department as a broker-corporation

(registration number 0255869), with an address of 4699 North

State Road 7, Fort Lauderdale, Florida. However, in October

1996, without notice to the Florida Real Estate Commission,

Wakefield Realty relocated its offices to 2240 Woolbright Road,

Boynton Beach, Florida. On January 6, 1997, the license of its

corporate broker, Robinson, was reissued as a broker-salesperson

with Township Realty, Inc., and, no active broker having been

appointed to fill the vacancy within 14 calendar days, Wakefield

Realty's corporate registration was cancelled. Rule 61J2-5.018,

Florida Administrative Code.

The Dobson contract and related matters

(DOAH Case No. 97-5041)

5. On October 31, 1995, Respondents, Robinson and Wakefield

Realty, as agents for Hubert and Ruth Dobson, the Buyers,

presented a written offer to purchase a house owned by Adrienne

and Nancy Cutler, the Sellers, at 951 Southwest 88th Terrace,

Pembroke Pines, Florida.

6. On November 7, 1995, following negotiations, the

Dobsons' offer was accepted by the Sellers. The agreed purchase

price was $123,480, with the method of payment as follows: a

$2,000 deposit tendered with the offer; an additional deposit of

$4,000 "due within 10 United States banking days after date of

acceptance"; the proceeds ($117,306) of a new conventional

mortgage to be secured by the buyers; and, a balance of $174 to

be paid by the buyers at closing. All deposits were to be held

in escrow by Wakefield Realty.

7. In addition to the provisions of the agreement relating

to the deposits, discussed supra , the agreement contained the

following pertinent provisions:

D. NEW MORTGAGES:

. . . if this Contract provides for Buyer

to obtain a new mortgage, then Buyer's

performance under this Contract shall be

contingent upon Buyer's obtaining said

mortgage financing upon the terms stated, or

if none are stated, than upon the terms

generally prevailing at such time in the

county where the property is located. The

buyer agrees to apply within 5 banking days

. . . and to make a good faith, diligent

effort to obtain the mortgage financing. In

the event a commitment for said financing is

not obtained within 45 banking days . . .

from the date of this Contract, then the

other party may terminate this Contract by

delivery of written notice to the other party

or his agent, the deposit shall be returned

to the Buyer and all parties shall be

released from all further obligations

hereunder. This right of termination shall

cease upon the Buyer obtaining a written

commitment letter for mortgage financing at

the rate and terms of payment previously

specified herein prior to the delivery of the

notice of termination.

* * *

X. DEFAULT: In the event of default of

either party, the rights of the non-

defaulting party and the broker shall be as

provided herein and such rights shall be

deemed to be the sole and exclusive rights in

such event; (a) If Buyer fails to perform any

of the covenants of this Contract, all money

paid or deposited pursuant to this Contract

by the Buyer shall be retained by or for the

account of the Seller as consideration for

the execution of this Contract as agreed and

liquidated damages and in full settlement of

any claims for damages and specific

performance by the Seller against the

Buyer. . . .

* * *

(CHECK and COMPLETE THE ONE APPLICABLE)

(X) IF A WRITTEN LISTING AGREEMENT IS

CURRENTLY IN EFFECT:

Seller agrees to pay the Broker named above

including cooperating sub-agents and/or

cooperating Buyers Agents named, according to

the terms of an existing, separate written

agreement;

* * *

If Buyer fails to perform and deposit(s) is

retained, 50% thereof, but not exceeding the

Broker's fee above provided, shall be paid

Broker, as full consideration for Broker's

services including costs expended by Broker,

and the balance shall be paid to Seller.

8. To finance the purchase, Robinson submitted an

application on the Dobsons' behalf for a conventional residential

mortgage loan with Citizens Federal Bank. That application was

denied January 8, 1996.

9. Following the denial of their application, the Dobsons

made demand of Respondents, under the mortgage contingency

provision of the purchase agreement, for the return of their

$6,000 deposit. 3 Respondents, notwithstanding the rejection of

the Dobsons' application for financing and the Sellers' execution

of a release of deposit, which directed the escrow agent to

disburse the escrow deposit of $6,000 to the Dobsons, failed and

refused to return any portion of the deposit to the Dobsons. To

date, such failure continues, and the proof is compelling that

Respondents have converted the deposit to their own use and

benefit. 4

The Rafiee contract and related matters

(DOAH Case No. 98-0003)

10. On October 25, 1996, Respondent, Mizeral Robinson,

procured a written offer from Iran Rafiee to purchase a triplex

owned by Henry Sweigart, located at 11460 Northwest 39th Street,

Coral Springs, Florida. The stated purchase price was $195,000,

with the method of payment as follows: a $1,000 deposit tendered

with the offer; an additional deposit of $9,000 "due within 5

United States banking days after date of acceptance"; the

proceeds ($156,000) of a new conventional mortgage to be secured

by the buyer; and, a balance of $30,000 [sic] to be paid by the

buyer at closing. All deposits were to be held by Wakefield

Realty, Inc., Mizeral Robinson, escrow agent.

11. According to the "Deposit Receipt and Contract for Sale

and Purchase," Rafiee's offer was accepted on what appears to be

October 27, 1996 (Petitioner's Exhibit 12), and Rafiee's initial

deposit, which was in Robinson's possession by at least

October 25, 1996, 5 was deposited on October 30, 1996. 6 Accepting

October 25, 1996, as the date Robinson received the check, the

check was deposited "no later than the end of the third business

day following receipt." 7 Rule 61J2-14.008(d), Florida

Administrative Code.

12. In addition to the provisions of the agreement relating

to the deposits, discussed supra , the agreement contained the

following pertinent provisions:

29. DEFAULT: In the event of default of

either party, the rights of the non-

defaulting party and the broker shall be as

provided herein and such rights shall be

deemed to be the sole and exclusive rights in

such event. If Buyer fails to perform any of

the covenants of this Contract, all money

paid or to be paid as deposits pursuant to

this Contract by the Buyer shall be retained

by or for the account of the Seller as

consideration for the execution of this

Contract as agreed and liquidated damages and

in full settlement of any claims for damages

and specific performance by the Seller

against the Buyer.

* * *

(CHECK AND COMPLETE THE ONE APPLICABLE)

(X) IF A WRITTEN LISTING AGREEMENT IS

CURRENTLY IN EFFECT:

Seller agrees to pay the Broker(s) named

above according to the terms of an existing,

separate written professional service fee

agreement;

* * *

If Buyer fails to perform and deposit(s) is

retained, 50% thereof, but not exceeding the

Broker's fee above provided, shall be paid

Broker, as full consideration for Broker's

services including costs expended by Broker,

and the balance shall be paid to Seller.

13. Within days of the acceptance of her offer, Ms. Rafiee

decided that she no longer desired to purchase the property and,

on or about October 31, 1996, notified Robinson of her decision

and requested the return of her deposit. At the time, Robinson

was noncommittal and, observing that the check had only recently

been deposited and likely had not yet been paid, stated they

would have to speak of the matter at a later date.

14. Thereafter, when pressed regarding the return of

Ms. Rafiee's deposit, Robinson informed her that the deposit had

been given to the seller, as required by the contract.

Nevertheless, when Ms. Rafiee voiced her intention to pursue the

matter further, Robinson agreed to pay her $800 (the parties

agreeing that Robinson was entitled to $200 for her efforts) by

December 20, 1996. Following the passage of a number of

deadlines, and one check returned for insufficient funds,

Robinson, in or about May 1997, eventually paid Ms. Rafiee the

$800.00.

15. At hearing, Robinson averred that because of

Ms. Rafiee's default, she and the seller were, under the terms of

the contract, each entitled to 50% of the $1,000 deposit, and

that she disbursed the deposit accordingly. As for her offer to

pay Ms. Rafiee $800, it was Robinson's view that such offer was

made to appease Ms. Rafiee, since Robinson expected to secure

further business from her, and should not be considered an

admission that Ms. Rafiee was entitled to the return of any of

her deposit.

16. Given Ms. Rafiee's default under the purchase

agreement, it must be concluded that Robinson, as the broker, had

apparent authority to retain 50% ($500) of the deposit and to

remit the remaining 50% ($500) to the seller. This is what

Robinson avers she did and, given the proof or, stated

differently, the lack thereof, it cannot be resolved, with the

requisite degree of certainty, that she did otherwise. 8

CONCLUSIONS OF LAW

17. The Division of Administrative Hearings has

jurisdiction over the parties to, and the subject matter of,

these proceedings. Sections 120.569, 120.57(1), and 120.60(5),

Florida Statutes.

18. Where, as here, the Department proposes to take

punitive action against a licensee, it must establish grounds for

disciplinary action by clear and convincing evidence. Section

120.57(1)(h), Florida Statutes (1997), and Department of Banking

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

That standard requires that "the evidence must be found to be

credible; the facts to which the witnesses testify must be

distinctly remembered; the testimony 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 a 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). Moreover, the disciplinary action taken

may be based only upon the offenses specifically alleged in the

administrative complaint. See Kinney v. Department of State , 501

So. 2d 129 (Fla. 5th DCA 1987); Sternberg v. Department of

Professional Regulation, Board of Medical Examiners , 465 So. 2d

1324 (Fla. 1st DCA 1985); and Hunter v. Department of

Professional Regulation , 458 So. 2d 844 (Fla. 2d DCA 1984).

Finally, in determining whether Respondent violated the

provisions of section 475.25(1), as alleged in the Administrative

Complaint, one "must bear in mind that it is, in effect, a penal

statute. . . . This being true, the statute must be strictly

construed and no conduct is to be regarded as included within it

that is not reasonably proscribed by it." Lester v. Department

of Professional and Occupational Regulations , 348 So. 2d 923, 925

(Fla. 1st DCA 1977).

The Dobson transaction (DOAH Case No. 97-5041)

19. Pertinent to the charges pending under DOAH Case No.

97-5041, Section 475.25(1), Florida Statutes, provides that the

Florida Real Estate Commission 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:

* * *

(d)1. Has failed to account or deliver to

any person, including a licensee under this

chapter, at the time which has been agreed

upon or is required by law or, in the absence

of a fixed time, upon demand of the person

entitled to such accounting and delivery, any

personal property such as money, fund,

deposit, check, draft, abstract of title,

mortgage, conveyance, lease, or other

document or thing of value. . .

* * *

(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.

20. Pertinent to the charges which rely on a perceived

violation of Subsection 475.25(1)(e), Florida Statutes, are the

provisions of Rule 61J2-14.012(1), Florida Administrative Code,

which provides:

(1) A broker who receives a deposit 9 as

previously defined shall preserve and make

available to the BPR, or its authorized

representative, all deposit slips and

statements of account rendered by the

depository in which said deposit is placed,

together with all agreements between the

parties to the transaction. In addition, the

broker shall keep an accurate account of each

deposit transaction and each separate bank

account wherein such funds have been

deposited. All such books and accounts shall

be subject to inspection by the DPR or its

authorized representatives at all reasonable

times during regular business hours.

Also pertinent to a perceived violation of subsection

427.25(1)(e) are the provisions of Rule 61J2-5.018, Florida

Administrative Code, which provide as follows:

(1) A corporation shall have at all times

registered the name(s) of its officer(s) and

director(s). In the event that a corporation

has but one active broker, and such broker

dies, resigns, or is otherwise removed from

the position as the active broker, then, in

such event, such vacancy shall be filled

within 14 calendar days during which no new

brokerage business may be performed by the

corporation or a licensee registered with the

corporation until a new active broker is

appointed and registered with the

corporation. It shall be the duty of the

corporation to immediately notify the

Commission of such vacancy and of the steps

taken to fill this vacancy.

(2) Failure to appoint another active

broker within 14 calendar days will result in

the automatic cancellation of the corporate

registration, and the licenses of all its

officer(s), director(s) and salesperson(s)

will become involuntarily inactive.

21. Here, the proof (as noted in the findings of fact and

corresponding endnotes) demonstrated, with the requisite degree

of certainty, that Respondents, Mizeral Robinson and Wakefield

Realty, Inc., failed to account for and deliver up the Dobson

deposit as required by law. Consequently, Counts I and II of the

Administrative Complaint (DOAH Case No. 97-5041) have been

sustained.

22. The proof (as noted in the findings of fact and

corresponding endnotes) further demonstrated that Respondents

failed to maintain or make available to the Department or its

authorized representative, all deposit slips and statements of

account rendered by the depository in which the Dobson deposit

was placed, and failed to keep an accurate account of each

deposit transaction and each separate bank account wherein the

Dobsons' funds were deposited. Indeed, the brokerage ledger

Respondents produced was a fabrication; no records were produced

which would account for each deposit the Dobsons tendered; and no

records were produced which would explain the disposition of the

Dobson deposits. Consequently, Counts III and IV of the

Administrative Complaint have been sustained.

23. Finally, the proof demonstrated that as of January 6,

1997, Wakefield Realty, Inc., failed to have at least one officer

or director with an active broker's license and failed, within 14

calendar days thereafter, to appoint another active broker.

Consequently, Count V of the Administrative Complaint has been

sustained. However, the proof further reflected that the

consequences of such failure, cancellation of Wakefield Realty's

corporate registration, has already occurred. Consequently, no

further penalty need be assessed for such violation.

The Rafiee transaction (DOAH Case No. 98-0003)

24. Pertinent to the charges pending under DOAH Case

No. 98-0003, Section 475.25(1), Florida Statutes, provides that

the Florida Real Estate Commission may take disciplinary action

against a licensee when she:

(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 . . .

* * *

(d)1. Has failed to account or deliver to

any person, including a licensee under this

chapter, at the time which has been agreed

upon or is required by law or, in the absence

of a fixed time, upon demand of the person

entitled to such accounting and delivery, any

personal property such as money, fund,

deposit, check, draft, abstract of title,

mortgage, conveyance, lease, or other

document or thing of value. . .

* * *

(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 her or

him by any person dealing with her or 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 her or 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. . . .

25. Pertinent to the perceived violation of subsection

475.25(1)(e), 10 Section 475.23, Florida Statutes, provides:

A license shall cease to be in force

whenever a broker changes her or his business

address . . . The licensee shall notify the

commission of the change no later than 10

days after the change, on a form provided by

the commission.

26. Pertinent to the perceived violation of subsection

475.25(1)(k), Rule 61J2-14.008(d), Florida Administrative Code,

provides:

(d) "Immediately" means the placement of a

deposit in an escrow account no later than

the end of the third business day following

receipt of the item to be deposited.

Saturdays, Sundays and legal holidays shall

not be considered as business days.

27. Here, based on the findings and observations noted in

the findings of fact, as well as the corresponding endnotes, it

must be concluded that the Department failed to demonstrate, by

clear and convincing evidence, that Robinson is guilty of the

violations alleged in Counts I, II, III, and V of the

Administrative Complaint (DOAH Case No. 98-0003). With regard to

Count IV, the proof does demonstrate that Robinson is guilty of

"failing to properly and timely notify Petitioner of a change of

address . . . in violation of § 475.23, Fla. Stat.," and that, as

a consequence of such change of address, she "operate[d] as a

broker without an active, current and valid Florida brokers

license."

The penalty

28. Having reached the foregoing conclusions, it remains to

resolve the appropriate penalty that should be imposed.

Pertinent to this issue, Rule 61J2-24.001, Florida Administrative

Code, provides the disciplinary guidelines on which disciplinary

penalties will be based, as well as the aggravating or mitigating

circumstances which may be considered to support a deviation from

the guidelines.

29. Giving due consideration to the Department's

disciplinary guidelines, as well as the aggravating and

mitigating circumstances, it must be concluded that the

appropriate penalty for the violations demonstrated in these

proceedings is, as suggested by the Department, revocation of

licensure. In so concluding, it is observed that real estate

brokerage is a business greatly affected by the public trust. As

observed in Shelton v. Florida Real Estate Commission , 120 So. 2d

191, 194 (Fla. 2d DCA 1960):

. . . A real estate broker occupies a

privileged position wherein those of his

profession enjoy a monopoly to engage in a

lucrative business. . . . The statutes

regulating the activities of real estate

brokers in their business were designed to

protect the public and to safeguard those

persons who put their money and trust in the

hands of real estate brokers. Ahern v.

Florida Real Estate Commission , 1942, 149

Fla. 706, 6 So. 2d 857. Anyone who deals

with a licensed broker may assume that he is

dealing with an honest and ethical

person. . . .

Moreover, the holder of a brokerage license stands in a fiduciary

relationship with her client. See United Homes, Inc. v. Moss ,

154 So. 2d 351 (Fla. 2d DCA 1963). Where such relationship is

shown to exist, as it was in the Dobson transaction, the law

extracts a high standard of loyalty on the part of an agent

toward her principal, requiring of the agent the utmost good

faith toward her principal in all matters connected with the

employment. See generally 2 Fla. Jur.2d, Agency and Employment ,

Sections 84 and 89. Here, Robinson's lack of good faith has been

clearly demonstrated, and evidences Robinson's lack of the

requisite good character necessary for licensure as a real estate

broker in the State of Florida.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that a Final Order be entered revoking

Respondents' licensure and eligibility for licensure.

DONE AND ENTERED this 29th day of May, 1998, in Tallahassee,

Leon County, Florida.

___________________________________

WILLIAM J. KENDRICK

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 29th day of May, 1998.

ENDNOTES

1/ Petitioner's Exhibit 1 was a copy of the checks received as

Petitioner's Exhibit 20. Apparently, because of the duplicity,

Petitioner did not move its Exhibit 1 into evidence.

2/ According to the transcript, Respondents' Exhibit 6 was to

have been a composite exhibit, which was to include Respondent's

bank statement for November 30, 1995, and December 29, 1995.

(Transcript, pages 131-134). Exhibit 6, as filed with the

Division of Administrative Hearings only included the November 30,

1995, bank statement. Respondent's testimony regarding the

content of the December 29, 1995, bank statement has, however,

been credited. ( See Endnote 3, paragraph 9).

3/ At hearing, Robinson disputed that the Dobsons had paid the

$6,000 required by the terms of the purchase agreement. However,

having considered the evidence offered, including a comparison of

Respondents' "brokerage ledger" (Petitioner's Exhibit 6), the bank

statement of November 1995 for Respondents' trust account

(Respondents' Exhibit 6), the Dobsons' bank statement for

November 1995 (Petitioner's Exhibits 21 through 23), and the

checks tendered by the Dobsons for the deposit (Petitioner's

Exhibit 20), it is apparent that the Dobsons did pay to

Respondents the $6,000 deposit required by the agreement, and that

Robinson's testimony and other proof to the contrary is unworthy

of belief.

In reaching the foregoing conclusion, it is first observed that

the proof is compelling that Robinson is not hesitant to

prevaricate or create false documents when her personal interests

are at stake. A patent example of this behavior is the letter she

presented to the Department's investigator which purported to bear

the Dobsons' signatures and which sought to withdraw their

complaint (Petitioner's Exhibit 5). The document was a sham, and

was not prepared or signed by the Dobsons.

Further proof of Robinson's duplicity may be found in an

examination of Respondents' "brokerage ledger" for November and

December 1995 (Petitioner's Exhibit 6), and a comparison of the

ledger with the bank statement of November 1995 for Respondents'

trust account (Respondents' Exhibit 6), the Dobsons' bank

statement for November 1995 (Petitioner's Exhibits 21 through 23),

and the checks tendered by the Dobsons for the deposit

(Petitioner's Exhibit 20).

Notably, if one accepted Respondents' "brokerage ledger" as an

accurate record of the Dobsons' deposit history, one could only

conclude that they had not paid one dollar towards the deposit

because every check they tendered was returned unpaid for not

sufficient funds. However, a comparison of the ledger with other

evidence noted supra demonstrates that the ledger does not

accurately portray the Dobsons' deposit history, and that

Robinson's testimony is not worthy of belief.

In reaching the foregoing conclusion the following observations

are made. First, Respondents' ledger reflects that the Dobsons'

initial deposit of $2,000 (check number 453, dated October 31,

1995) was deposited November 1, 1995, returned for "NSF" (not

sufficient funds) November 6, 1995, re-deposited November 7, 1995

(Petitioner's November bank statement does not show a deposit for

November 7, but does show one for November 9, 1995), and returned

for "NSF" November 13, 1995. Except for the initial deposit of

the Dobsons' check on November 1, 1995, the remaining entries

which attribute returns and re-deposits of this check are false.

Such conclusion is apparent from the face of the Dobsons' check

(number 453) which was paid, and never returned "NSF." Such is

also apparent from the Dobsons' November bank statement which,

contrary to the events depicted on Respondents' ledger, reflects

no returns or re-deposits for Dobsons' check number 453. Clearly,

the activity the ledger seeks to portray or conform to activities

on Respondent's bank statement of November 1995 (the return NSF of

November 6, 1995, the re-deposit of November 9, 1995, and the

return NSF of November 13, 1995) is not related to the Dobson

transaction, and Respondents' portrayal of the activity as so

related is false.

Further evidence of the unreliability of Robinson's testimony and

the Respondents' documentation is evident from Respondents

manipulation of the balance of the deposit the Dobsons tendered on

November 9, 1995. That tender consisted of two checks payable to

Wakefield Realty, Inc., with the first check (number 457) in the

sum of $2,325 (this check included funds for a $325.00 mortgage

processing fee), and the second check (number 458) in the sum of

$2,000. Both checks were received by Robinson, endorsed Wakefield

Realty, and deposited at NationsBank (Respondents' bank) on

November 13, 1995; however, there is no entry in Respondents'

ledger reflecting the deposit of check number 458 for $2,000, and

no entry on the November bank statement for Respondents' trust

account reflecting that deposit. Obviously, Respondents deposited

check number 458 to an account, other than their trust account, at

NationsBank.

Regarding the further handling of those checks the proof

demonstrates that they were both presented for payment to the

Dobsons' bank on November 14, 1995, and that check number 458

($2,000) was paid and check number 457 ($2,325) was rejected by

Dobsons' bank for NSF. Check number 457 ($2,325) was re-deposited

to Respondents' trust account on November 17, 1995, and again

rejected by Dobsons' bank on November 20, 1995, for NSF.

At this point, the Respondents had received $4,000 of the $6,000

deposit required by the contract; however, only $2,000 was placed

in Respondents' trust account. For the balance of the deposit,

and in replacement of check number 457 ($2,325), the Dobsons

tendered two checks to Respondents. The first check (number 465)

dated November 22, 1995, was payable to Wakefield Realty, Inc., in

the sum of $2,000 and represented the balance of the deposit due

under the contract. The second check (number 467) dated

November 28, 1995, was made payable, at her request, to Robinson

and represented reimbursement for the mortgage processing fee.

Respondents deposited Dobsons' check number 456 ($2,000) to their

trust account on November 22, 1995, and the check was rejected by

the Dobsons' bank on November 24, 1995, for NSF. At hearing, Ms.

Robinson testified that this check (number 456) was never re-

deposited and Respondents never received its proceeds. As proof,

Respondents pointed to their ledgers for November and December

1995 and trust account statements for November and December 1995,

which reflect no further activity regarding check number 456.

(Petitioner's Exhibit 6; Respondent's Exhibit 6; and Transcript,

page 133). However, the Dobsons' bank statement for November 1995

clearly reflects that check number 465 ($2,000) was re-deposited,

and Dobsons' bank honored (paid) the check on November 30, 1995.

Again, the only logical conclusion to draw is that Respondents re-

deposited the check to an account other than their trust account

at NationsBank. The Dobsons' check number 467 for the mortgage

processing fee was paid by its bank on November 29, 1995.

Consequently, by November 30, 1995, the Dobsons had paid the

entire $6,00 deposit to Respondents; however, only $2,000 of that

amount was placed in their trust account. Of note, Respondents'

trust account was closed on December 30, 1995, with a balance of

$207.00. (Petitioner's Exhibit 6). Here, Respondents have failed

to produce any record, provide any explanation, or otherwise

account for the disposition of the $2,000 they were holding in

their trust account, or the $4,000 they received in trust that was

not deposited to their trust account.

Following the denial of their mortgage application, Robinson

prepared a "Release of Deposit Receipt." (Petitioner's

Exhibit 8). According to Robinson, she prepared the release at

the Sellers' request, because the time for closing had passed, and

they wished to proceed with a sale to another buyer. (Transcript,

page 177). The denial of the Dobsons' mortgage application was,

most likely, the dispositive issue.

The release prepared by Robinson provided:

WITNESSETH:

That each of the parties hereto in

consideration of each of the parties

releasing all of the other parties from the

aforesaid Deposit Receipt, do hereby release

each of the other parties to said Deposit

Receipt from any and all claims, actions or

demands whatsoever which each of the parties

hereto may have up to the date of this

agreement against any of the other parties

hereby by reason of said Deposit Receipt.

It is the intention of this agreement that

any responsibility or obligations or rights

arising by virtue of said Deposit Receipt are

by this release declared null and void and of

no further affect when signed by all of the

above named parties.

The escrow agent holding the deposit under

the terms of said Deposit Receipt is hereby

directed and instructed forthwith to disburse

said deposit held in escrow in the following

manner:

$ 6,000.00 to Ruth and Hubert Dobson

* * *

IN WITNESS WHEREOF the parties have

hereunto set their hands and seals the day

and year below written.

The release was signed by Robinson on what appears to be

January 10, 1996, two days after the denial of the Dobsons'

mortgage loan application, and by the Sellers on January 15, 1996.

Oddly, the release also bears what appear to be the signatures of

the Dobsons; however, they deny having signed the document.

Clearly, the Dobsons would have no reason to refuse to sign the

release, if presented.

According to Robinson, the circumstances surrounding the

preparation of the release were as follows:

HEARING OFFICER KENDRICK: Mrs. Robinson, if

you didn't receive $6,000 from the Dobsons

why did you execute the release of deposit

receipt?

THE WITNESS: The sellers had called me and

said that they had a buyer for their home and

they want -- the time for closing was

finished. The Dobsons hadn't closed. They

did not wish to continue with this contract

anymore but they wanted to close it out

because they wanted to sell their home to the

potential buyer that they had.

I merely went into my file, saw that the

contract said 6,000 and went ahead and

prepared the documents and faxed it down to

the agent. At the time I was very ill. I

must admit that I did not go through all of

my documentations. When this document came

back to me and I decided to go ahead and

disburse to the Dobsons the 6,000 and then

went through the file to see where the funds

were, that's when I discovered or it came

back to my attention that in fact the checks

did not all clear and I tried to sit with

them and discuss this and they keep refusing

that if I did not have $6,000 to give to

them, they did not wish to speak to me.

(Transcript, pages 177 and 178).

Having considered the proof, Robinson's explanation for her

failure to disburse the proceeds to the Dobsons is unworthy of

belief. Clearly, by November 30, 1995, the Dobsons had paid the

entire $6,000 deposit to Respondents. Notwithstanding that

payment, and notwithstanding the Sellers' release, Respondents

wrongfully failed to release any portion of the deposit to the

Dobsons.

Finally, given the foregoing, it is apparent that the records

Respondents produced for the Department's investigator, as well as

at hearing, do not represent an accurate account of each deposit

transaction and each separate bank account where the Dobson funds

were deposited, as required by Rule 61J2-14.012, Florida

Administrative Code. Consequently, it must be concluded that

Respondents either failed to maintain such records or refused to

make them available on demand.

4/ At hearing, Robinson testified that she retained the monies

deposited by the Dobsons under the default provision of the sales

contract. According to Robinson, since the Dobsons did not pay

the last $2,000 of the deposit they were in default and she, as

the broker, was entitled to retain 50 percent of the deposit.

Given the conclusion that the Dobsons deposited the full $6,000,

Respondents' explanation for retaining any of their money is

unpersuasive. Moreover, even assuming only $4,000 was deposited,

Respondents' claim would be limited to $2,000, with the balance to

the Sellers or, pursuant to the release, the Dobsons. Here,

Respondents retained the entire deposit.

Robinson also suggested at hearing, that the lateness of the

Dobsons' deposit provided a basis to claim a default under the

provisions of the sales contract, which required the balance of

the deposit "within 10 United States banking days after date of

acceptance." The short answer to Robinson's suggestion is that

the Dobsons' deposit monies were accepted, late or not, no default

was called, and their mortgage application processed for an

anticipated closing. Clearly, the tardiness of the Dobsons'

deposit was never an issue, and Robinson's suggestion that the

lateness of their deposit constituted a default warranting

retention of the deposit is unpersuasive. Moreover, even if

warranted, Respondents were not authorized to retain the entire

deposit.

5/ Although the proof suggests that Robinson may have been given

the check some time before, with regard to another property or

offer, it is unclear when this occurred. Consequently, to ascribe

any date, other than October 25, 1996, would be speculative.

6/ Petitioner introduced in evidence a copy of a bank statement

for Wakefield Realty, Inc., for the period of October 1, 1996, to

October 30, 1996. (Petitioner's Exhibit 13). That statement

reflects a deposit on October 28, 1996, of $1,000; however, that

statement is for account number 32111878106. Rafiee's check was

deposited October 30, 1996, to account number 316090392310.

(Petitioner's Exhibit 11).

7/ October 25, 1996, was a Friday. Consequently, the third

business day following receipt was Wednesday, October 30, 1996.

8/ Robinson's letter of November 7, 1996 (Respondents'

Exhibit 8), as well as the money order that purportedly

accompanied it, have, most likely, been fabricated. In so

concluding, it is observed that the explanation Robinson offered

for tendering 50% of the deposit to the seller (that Ms. Rafiee

lied about the reason she could not proceed with the purchase) was

not true. Moreover, the money order is facially suspect. First,

the date of the money order "November 6, 96" appears to have been

typed with two different instruments and, instead of reading 1996,

as one would expect on a negotiable instrument, it reads "96,"

suggesting an alteration. Further suspect is the "500" following

Mr. Sweigart's name, which was also prepared by a different

instrument. Finally, rendering the money order further suspect,

is the name "Henry Sweigart" and "Re: Wakefield Realty," which

were apparently affixed by yet a third instrument, and the fact

that such entries appear at an angle to the other entries.

Suspicion of Respondent's proof is not, however, an adequate basis

on which to premise a conclusion that the agency has sustained its

charges. Rather, it is the Department's burden throughout this

proceeding to demonstrate by clear and convincing evidence the

charges it has made against Respondents. This, with regard to the

Rafiee transaction, the Department has failed to do. Notably

absent from the Rafiee case, as contrasted to the Dobson Case, was

a charge that Respondents failed to maintain or produce on demand

records which evidenced an accurate accounting of the deposit.

9/ Rule 61J2-14.008 Definitions.

(1)(a) A "deposit" is a sum of money, or

its equivalent, delivered to a real estate

licensee, as earnest money, or a payment, or

a part payment, in connection with any real

estate transaction named or described in

s. 475.01(1)(c), Florida Statutes. . . .

10/ The Administrative Complaint, Count IV, also alleges that the

same misconduct which supports a violation of Subsection

475.25(1)(e), Florida Statutes, also supports a violation of

Subsection 475.25(1)(a), Florida Statutes. Such charge is

duplicative and need not be addressed.

COPIES FURNISHED:

Geoffrey T. Kirk, Esquire

Department of Business and

Professional Regulation

Division of Real Estate

Post Office Box 1900

Orlando, Florida 32802-1900

Donnette Reid, Esquire

Law Offices of Glantz & Glantz

Wellesley Corporate Plaza

7951 Southwest Sixth Street

Suite 200

Plantation, Florida 33324

Henry M. Solares, Director

Division of Real Estate

Department of Business and

Professional Regulation

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.