98-004141 Division Of Real Estate vs. Mayra Guzman Status: Closed Recommended Order on Friday, February 12, 1999.

Summary: Proof failed to support the conclusion that agent obtained her licensure by fraud or misrepresentation although she had not completed continuing education requirement for renewal.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case No. 98-4141

)

MAYRA GUZMAN, )

)

Respondent. )

__________________________________)

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

December 7, 1998, by video teleconference.

APPEARANCES

For Petitioner: Ghunise Coaxum, Esquire

Department of Business and

Professional Regulation

Division of Real Estate

Post Office Box 1900

Orlando, Florida 32802-1900

For Respondent: Frederick H. Wilsen, Esquire

The Rolls Building

1999 West Colonial Drive, Suite 211

Orlando, Florida 32804

STATEMENT OF THE ISSUE

At issue is whether Respondent committed the offense alleged

in the Administrative Complaint and, if so, what disciplinary

action should be taken.

PRELIMINARY STATEMENT

By a two-count Administrative Complaint dated August 18,

1998, Petitioner charged that Respondent, a licensed real estate

salesperson, violated certain provisions of Section 475.25,

Florida Statutes. Count I alleged that Respondent violated the

provisions of Subsection 475.25(1)(m), Florida Statutes, by

having "obtained a license by means of fraud, misrepresentation,

or concealment." The gravamen of such charge was Petitioner's

contention that when renewing her real estate license in

September 1997, Respondent falsely represented that she had

completed the necessary continuing education required for

renewal. Count II alleged that Respondent's failure to comply

with the continuing education requirements of Rule 61J2-3.009,

Florida Administrative Code, constituted a violation of the

provisions of Subsection 475.25(1)(e), Florida Statutes.

Respondent filed an election of rights wherein she disputed

the allegations of fact contained in the Administrative

Complaint. Consequently, Petitioner referred the matter to the

Division of Administrative Hearings for the assignment of an

administrative law judge to conduct a formal hearing pursuant to

Sections 120.569, 120.57(1), and 120.60(5), Florida Statutes.

At hearing, Petitioner called Roberto Castro, as a witness,

and Petitioner's Exhibits 1 through 5 were received into

evidence. Respondent, Mayra Guzman, testified on her own behalf,

and Respondent's Exhibits 1 and 2 were received into evidence.

The transcript of the hearing was filed January 13, 1999,

and the parties were accorded 20 days from that date to file

proposed recommended orders. Consequently, the parties waived

the requirement that a recommended order be rendered within 30

days after the transcript has been filed. The parties elected to

file such proposals, and they have been duly considered.

FINDINGS OF FACT

1. Petitioner, Department of Business and Professional

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

government licensing and regulatory agency charged with the duty

and responsibility to prosecute administrative complaints

pursuant to the laws of the State of Florida, in particular

Section 20.165, Florida Statutes, Chapters 120, 455, and 475,

Florida Statutes, and the rules promulgated pursuant thereto.

2. Respondent, Mayra Guzman, is now and has been at all

times material hereto, a licensed real estate salesperson in the

State of Florida, having been issued license number 0582273, in

association with Terranova Corporation, a broker corporation,

located at 1200 Brickell Avenue, Suite 1500, Miami, Florida.

3. In 1997, the Department provided Respondent with a

renewal notice, which reminded her that her salesperson license

was due to expire September 30, 1997. The renewal notice carried

the following legend:

IMPORTANT: BY SUBMITTING THE APPROPRIATE

RENEWAL FEES TO THE DEPARTMENT OR THE AGENCY,

A LICENSEE ACKNOWLEDGES COMPLIANCE WITH ALL

REQUIREMENTS FOR RENEWAL.

Respondent submitted the renewal notice, as well as the

appropriate renewal fee, and the Department renewed her license.

4. At the time Respondent submitted her application, she

knew that successful completion of 14 hours of continuing

education was a requirement for renewal of her real estate

salesperson license.

5. In or about May 1998, the Department conducted a routine

office inspection of Terranova Corporation. At that time, the

Department requested proof that Respondent had satisfactorily

completed 14 hours of continuing education for the period

beginning October 1, 1995, and ending September 30, 1997, that

would support the renewal of her license in September 1997.

6. Respondent was unable to produce written proof (a report

of completion) that she had successfully completed the continuing

education requirement prior to renewal; however, she did produce

a report from Gold Coast School of Real Estate which noted she

started the 14-hour continuing education (correspondence) course

on January 1, 1998, and successfully completed the course on

January 28, 1998. At the time, Respondent explained her failure

to have proof of course completion prior to renewing her license,

as follows:

. . . In August of 1997, in order to renew

my Florida Real Estate License, I requested

the 14-hour course and test from Gold Coast

School of Real Estate. I filled out all of

the paperwork and returned it to Gold Coast

as required.

In September 1997 I sent in the renewal fee

to the State.

After a while I realized I hadn't received

any confirmation from Gold Coast, so I called

them. They stated they couldn't locate my

paperwork and I therefore needed to pay for

another book and test. I did so and in

January 1998 I received confirmation that I

had passed. . . .

7. Notwithstanding, on August 18, 1998, the Department

filed the Administrative Complaint which is the subject matter of

this case and charged that Respondent violated Subsection

475.25(1)(m), Florida Statutes, by having "obtained a license by

means of fraud, misrepresentation or concealment," and Subsection

475.25(1)(e), Florida Statutes, by having failed to satisfy the

continuing education requirements prescribed by Rule 61J2-3.009,

Florida Administrative Code. According to the complaint, the

disciplinary action sought for each count or separate offense

. . . may range from a reprimand; an

administrative fine not to exceed $5,000.00

per violation; probation; suspension of

license, registration or permit for a period

not to exceed ten (10) years; revocation of

the license, registration or permit; and any

one or all of the above penalties as provided

for by § 455.227 and § 475.25(1), Fla. Stat. 1

and Fla. Admin. Code R. 61J2-24.001. . . .

8. At hearing, Respondent reiterated her prior explanation

that she had offered for not having written proof of having

successfully completed the continuing education course prior to

renewal and that, consequently, she had retaken the course in

January 1998. Additionally, Respondent offered proof of payment

for the course on August 6, 1997 (Respondent's Exhibit 1), and

the following explanation of course completion, prior to license

renewal, which led her to believe her completion of the course

was successful and would lead, in due course, to written

acknowledgment of successful completion by the school:

Q. Prior to submitting your signed renewal

notice, in order to comply with the

continuing education requirement, did you

obtain the correspondence course for the 14

hours from Gold Coast?

A. Yes.

Q. Did the correspondence cost include a

course book and a test booklet?

A. Yes, it did.

Q. At the end of each chapter in the

course book, was there a progressive quiz?

A. There was a quiz, yes.

Q. Were the answers for the quiz provided

at the end of the course book?

A. Yes.

Q. Did you take the progressive quiz after

concluding each chapter?

A. Yes, I did.

Q. For the total book, about how many

incorrect answers did you have?

A. I don't remember, but there wasn't

many. It was fairly easy.

Q. Was the test for continuing education

course an open book test?

A. Yes, it was.

Q. After completing the test, did you

forward the test booklet to Gold Coast for

grading?

A. Yes, I did.

Q. Based upon your performance on the

progressive quiz after each chapter, do you

have any reason to believe that you had not

passed the test?

A. Absolutely not. I had no doubt that I

passed the course.

Q. Did you think that you had successfully

completed the course?

A. Yes.

Q. Did you then submit the license renewal

notice to the Division of Real Estate?

A. Yes, I did.

Q. After you received your license, did

you realize that you had not received a

course report certificate from Gold Coast?

A. Immediately I didn't think about it.

After awhile, I though, "Shouldn't I have

gotten something back from the school telling

me this?" But at the time, I thought that

the school also sent it directly to the

State, notifying them that I had passed the

school. But I always like to keep proof of

things, so I called the school and I asked

them to see if they could send me the

completion and they -- that's when I learned

that I -- they didn't have anything. So I

did it again.

9. Here, Respondent's explanation was plausible, and her

demeanor not wanting of candor or sincerity. Consequently,

Respondent's testimony is credited, and it is resolved that, at

the time she submitted her renewal application, Respondent did

not intend to mislead or deceive the Department, nor did she act

with reckless disregard for the truth.

CONCLUSIONS OF LAW

10. 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 (1997).

11. Where, as here, the Department proposes the 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).

"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).

12. Pertinent to this case, Section 475.25(1), Florida

Statutes, provides that the Florida Real Estate Commission may

discipline a licensee, if it finds that the licensee:

(e) has violated any of the provisions of

. . . any rule made or issued under the

provisions of this chapter or chapter 455.

* * *

(m) Has obtained a license by means of

fraud, misrepresentation, or concealment.

13. Also pertinent to this case, Rule 61J2-3.009, Florida

Administrative Code, provides:

Continuing Education for Active and Inactive

Broker and Salesperson licenses.

(1) All persons holding active or inactive

license as brokers or salespersons must

satisfactorily complete a minimum of 14

classroom hours of instruction of 50 minutes

each as prescribed or approved by the

Commission during each license renewal period

excluding the first renewal period of their

current license.

* * *

(5) . . .

(b) Satisfactory completion of the

Commission prescribed continuing education

course or courses by correspondence study is

demonstrated by achieving a grade of 80% or

higher on the Commission approved course

final examination prepared and administered

by the Florida institution or licensed real

estate school offering such correspondence

course after completing the correspondence

study material. . . .

14. Giving due regard to the continuing education

requirements of Rule 61J2-3.009, Florida Administrative Code, it

is apparent that "satisfactory completion" of a course requires a

passing grade on a final examination that is graded

(administered) by the institution, and not the student, to

demonstrate that the student has learned the essential facts and

concepts of the course. Respondent's course having failed to

progress to "satisfactory completion" (as evidenced by the

institution's grading and approval of her performance), it must

be concluded that Respondent violated the provisions of

Subsection 475.25(1)(e), Florida Statutes, by having failed to

"satisfactorily complete" the continuing education requirement

prescribed by Rule 61J2-3.009, Florida Administrative Code, as

alleged in Count II of the Administrative Complaint. Such

conclusion does not, however, resolved whether, by submitting her

application for renewal (which "acknowledged compliance with all

requirements for renewal"), when (unbeknown to her) the course

work had not been received or graded by the school, and proof of

course completion had not been issued by the school, constituted

a violation of Subsection 475.25(1)(m), Florida Statutes.

15. To establish that a licensee committed a violation of

Subsection 475.25(1)(m), the Department must show not only that

the licensee provided false or misleading information on her

application, but that she did so knowingly and intentionally.

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

1143 (Fla. 1st DCA 1992) ("[A] pplying to the words used [in

Section 475.25(1)(m)] their usual and natural meaning, it is

apparent that it is contemplated that an intentional act be

proved before a violation may be found."). Accord Walker v.

Department of Business and Professional Regulation , 23 Fla. L.

Weekly D292 (Fla. 5th DCA 1998). See also Gentry v. Department

of Professional and Occupational Regulations , 293 So. 2d 95, 97

(Fla. 1st DCA 1974) (statutory provision prohibiting licensed

physicians from "[m] aking misleading, deceptive and untrue

representations in the practice of medicine" held not to apply to

"representations which are honestly made but happen to be

untrue"; "[t]o constitute a violation, . . . the legislature

intended that the misleading, deceptive and untrue

representations must be made willfully (intentionally))"; and

Naekel v. Department of Transportation , 782 F.2d 975, 978

(Fed. Cir. 1986) ("[A] charge of falsification of a government

document [in this case, an employment application] requires proof

not only that an answer is wrong, but also that the wrong answer

was given with intent to deceive or mislead the agency. The fact

of an incorrect response cannot control the question of intent.

Were a bare inaccuracy controlling on the question of intent, the

'intent' element of the charge would be subsumed within the

distinct inquiry of whether the employee's answer adheres to the

true state of facts. A system of real people, pragmatic in their

expectations, would not easily tolerate a rule under which the

slightest deviation from truth would sever one's tenuous link to

employment. Indeed, . . . [the employment application] does not

require absolute accuracy. Instead an employee must certify that

the answers are 'true, complete and correct to the best of my

knowledge and belief, and are made in good faith.' No more than

that can reasonably be required. The oath does not ask for

certainty and does not preclude a change in one's belief.")

16. Here, it is undisputed that Respondent's representation

on the renewal application (that she was in "compliance with all

requirements for renewal") was inaccurate; however, the evidence

adduced at hearing (specifically the unrebutted testimony of

Respondent on the subject, which the undersigned has credited)

establishes that, in affirming in the manner she did, Respondent

did not intend to deceive or defraud anyone about her eligibility

for renewal, but rather responded in a manner she believed, in

good faith, was appropriate. Consequently, the charge, as

alleged in Count I, that Respondent "obtained [her] license by

means of fraud, misrepresentation or concealment in violation of

Section 475.25(1)(m)," Florida Statutes, must be dismissed.

17. Having resolved that Respondent committed the offense

set forth in Count II of the Administrative Complaint, it remains

to resolve the appropriate penalty that should be imposed.

Pertinent to this issue, Subsection 427.25(1), Florida Statutes,

authorizes the Florida Real Estate Commission to impose one or

more of the following penalties when it finds a licensee guilty

of an offense proscribed by that subsection:

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. . . .

18. Also pertinent to the penalty phase of this proceeding,

Section 455.2273, Florida Statutes, provides:

(1) Each board, or the department when

there is no board, shall adopt, by rule, and

periodically review the disciplinary

guidelines applicable to each ground for

disciplinary action which may be imposed by

the board, or the department when there is no

board, pursuant to this part, the respective

practice acts, and any rule of the board or

department.

(2) The disciplinary guidelines shall

specify a meaningful range of designated

penalties based upon the severity and

repetition of specific offenses, it being the

legislative intent that minor violations be

distinguished from those which endanger the

public health, safety, or welfare; that such

guidelines provide reasonable and meaningful

notice to the public of likely penalties

which may be imposed for proscribed conduct;

and that such penalties be consistently

applied by the board.

(3) A specific finding of mitigating or

aggravating circumstances shall allow the

board to impose a penalty other than that

provided for in such guidelines. If

applicable, the board, or the department when

there is no board, shall adopt by rule

disciplinary guidelines to designate possible

mitigating and aggravating circumstances and

the variation and range of penalties

permitted for such circumstances.

(4) The department must review such

disciplinary guidelines for compliance with

the legislative intent as set forth herein to

determine whether the guidelines establish a

meaningful range of penalties and may also

challenge such rules pursuant to s. 120.56.

(5) The administrative law judge in

recommending penalties in any recommended

order, must follow the penalty guidelines

established by the board or department and

must state in writing the mitigating or

aggravating circumstances upon which the

recommended penalty is based.

19. In response to the legislative requirements imposed by

Section 455.2273, Florida Statutes, the Florida Real Estate

Commission (Commission) adopted Rule 61J2-24.001, Florida

Administrative Code, titled "Disciplinary Guidelines." That rule

provides, in pertinent part, as follows:

(1) Pursuant to s. 455.2273, Florida

Statutes, the Commission sets forth below a

range of disciplinary guidelines from which

disciplinary penalties will be imposed upon

licensees guilty of violating Chapters 455 or

475, Florida Statutes. The purpose of the

disciplinary guidelines is to give notice to

licensees of the range of penalties which

normally will be imposed for each count

during a formal or an informal hearing. For

purposes of this rule, the order of

penalties, ranging from lowest to highest,

is: reprimand, fine, probation, suspension,

and revocation or denial. Pursuant to

s. 475.25(1), Florida Statutes, combinations

of these penalties are permissible by law.

Nothing in this rule shall preclude any

discipline imposed upon a licensee pursuant

to a stipulation or settlement agreement, nor

shall the range of penalties set forth in

this rule preclude the Probable Cause Panel

from issuing a letter of guidance.

20. Under the established guidelines there is not a

discrete penalty for a failure to comply with the continuing

education requirement imposed by Rule 61J2-3.009(1), Florida

Administrative Code; however, the guidelines do establish a

generic guideline for a violation of Subsection 475.25(1)(e),

Florida Statutes (the violation of "any rule or order or

provision under Chapters 475 and 455, F.S."), as follows:

(f) The usual action of the Commission

shall be to impose a penalty from an 8 year

suspension to revocation and an

administrative fine of $1,000.

Rule 61J2-24.001(1)(f), Florida Administrative Code.

21. Finally, Rule 61J2-24.001(4), Florida Administrative

Code, sets forth the aggravating and mitigating circumstances

which may be considered in determining the appropriate penalty,

as follows:

(b) Aggravating or mitigating

circumstances may include, but are not

limited to, the following:

1. The severity of the offense.

2. The degree of harm to the consumer or

public.

3. The number of counts in the

Administrative Complaint.

4. The number of times the offenses

previously have been committed by the

licensee.

5. The disciplinary history of the

licensee.

6. The status of the licensee at the time

the offense was committed.

7. The degree of financial hardship

incurred by a licensee as a result of the

imposition of a fine or suspension of the

license.

8. Violation of the provision of Chapter

475, Florida Statutes, where in a letter of

guidance as provided in s. 455.225(3),

Florida Statutes, previously has been issued

to the licensee.

22. Here, given the circumstances, it must be concluded

that the "usual" penalty prescribed by the Commission's rule

bears no reasonable relationship to the violation shown. 2 In so

concluding, it is observed that Respondent's failing was shown to

result from a misunderstanding, as opposed to an intentional act;

no aggravating factors were offered by the Department; and, to

the extent pertinent, the mitigating circumstances of record

compel a departure from the established norm. 3 At the most, the

record supports, as a penalty for the violation alleged in Count

II of the Administrative Complaint, the imposition of a

reprimand. 4

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that:

1. Count I of the Administrative Complaint be dismissed.

2. Respondent be found guilty of violating the provisions

of Subsection 475.25(1)(e), Florida Statutes, as alleged in

Count II of the Administrative complaint, and that for such

violation Respondent receive, as a penalty, a reprimand.

DONE AND ENTERED this 12th day of February, 1999, 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]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 12th day of February, 1999.

ENDNOTES

1/ The Department also sought an award of costs as provided for

by Section 455.227(3), Florida Statutes; however, it offered no

proof, at hearing, regarding what costs, if any, it incurred.

Consequently, there is no record basis on which to make a

recommendation concerning any cost award.

2/ The Department apparently concurs that Respondent's conduct

does not warrant the imposition of the usual penalty; however, it

offers no explanation of how it derived the penalty it proposed.

See Petitioner's Proposed Recommended Order, page 10.

3/ Consideration of the mitigating factors reveals that the

offense is not severe; that immediately upon realizing the

oversight, Respondent retook and successfully completed the

required course; there was no harm to a consumer or the public;

Respondent was only shown to have been guilty of one count in the

Administrative Complaint; and there was no showing that Respondent

had committed any other offense or had any disciplinary history,

including a letter of guidance.

4/ In assessing the penalty in this case, deference has been

accorded the Commission's rules. Section 455.2273(5), Florida

Statutes, and Gadsden State Bank v. Lewis , 348 So. 2d 343, 345

(Fla. 1st DCA 1977) ("[A] gencies must honor their own substantive

rules until, pursuant to . . . [Section 120.56, Florida Statutes

(1997)], they are amended or abrogated.") Contrast Arias v.

Department of Business and Professional Regulation, Division of

Real Estate , 23 Fla. L. Weekly D1026b (Fla. 3d DCA 1998), appeal

to the Florida Supreme Court (Case No. 93,500), dismissed July 28,

1998, as untimely.

COPIES FURNISHED:

Ghunise Coaxum, Esquire

Department of Business and

Professional Regulation

Division of Real Estate

Post Office Box 1900

Orlando, Florida 32802-1900

Frederick H. Wilsen, Esquire

The Rolls Building

1999 West Colonial Drive, Suite 211

Orlando, Florida 32804

Mayra Guzman

10030 Southwest 51st Terrace

Miami, Florida 33165

James Kimbler

Acting Division 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.