98-004260 Construction Industry Licensing Board vs. Juan Rodriguez Status: Closed Recommended Order on Wednesday, May 12, 1999.

Summary: Respondent was found guilty of assisting uncertified and unregistered person to practice contracting.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

CONSTRUCTION INDUSTRY )

LICENSING BOARD, )

)

Petitioner, )

)

vs. ) Case No. 98-4260

)

JUAN RODRIGUEZ, )

)

Respondent. )

________________________________)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings

by Administrative Law Judge William J. Kendrick, held a formal

hearing in the above-styled case on February 2, 1999, in Miami,

Florida.

APPEARANCES

For Petitioner: Theodore R. Gay, Esquire

Department of Business and

Professional Regulation

401 Northwest Second Avenue

Suite N-607

Miami, Florida 33128

For Respondent: Jorge E. Otero, Esquire

Tomlin & Tomlin, P.A.

75 Valencia Avenue, 4th Floor

Coral Gables, Florida 33134

STATEMENT OF THE ISSUES

At issue in this proceeding is whether Respondent committed

the offenses set forth in the Administrative Complaint and, if

so, what penalty should be imposed.

PRELIMINARY STATEMENT

On February 18, 1998, Petitioner issued a three-count

Administrative Complaint against Respondent which charged that

Respondent, a certified general contractor, committed certain

acts or omissions which subjected him to disciplinary action

under the provisions of Chapter 489, Part I, Florida Statutes.

Count I alleged that Respondent violated the provisions of

Subsection 489.129(1)(e), Florida Statutes, "by performing an act

which assists a person or entity in engaging in the prohibited

uncertified and unregistered practice of contracting . . . [when]

the certificateholder or registrant knows or has reasonable

grounds to know that the person or entity was uncertified and

unregistered." Count II alleged that Respondent violated the

provisions of Section 489.1265, Florida Statutes (1995), now

codified at Subsection 489.127(4), Florida Statutes, and,

therefore, Subsection 489.129(1)(j), Florida Statutes, "by

allowing and/or agreeing to allow an unlicensed contractor to use

his license number and/or by obtaining a building permit for

construction work without having entered into a contract to make

improvements to, or perform the contacting at, the real property

specified in the permit." Count III alleged that Respondent

failed to "continually maintain liability and property damage

insurance," as required by Rule 61G4-15.003(1), Florida

Administrative Code, and was, therefore, guilty of "misconduct or

incompetency in the practice of contacting," as defined by Rule

61G4-17.001(14)(b), Florida Administrative Code, and as

proscribed by Subsection 489.129(1)(n), Florida Statutes.

Respondent filed an answer to the Administrative Complaint

which raised disputed issues of fact. Consequently, on

September 21, 1998, 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 Joseph Wilson, Oscar Zapata,

and Consuelo Zapata as witnesses, and Petitioner's Exhibits 1

through 11 were received into evidence. Respondent testified on

his own behalf, but offered no additional proof.

The transcript of hearing was filed April 12, 1999, and the

parties were initially accorded 10 days from that date to file

proposed recommended orders; however, at Respondent's request the

time for filing was extend to May 7, 1999. Any proposal filed

prior to the entry of this order has been duly-considered.

FINDINGS OF FACT

Preliminary matters

1. At all times material hereto, Respondent, Juan

Rodriguez, was licensed by Petitioner, Department of Business and

Professional Regulation, Construction Industry Licensing Board

(Department), as a certified general contractor, having been

issued license number CG C005171. Respondent was licensed as an

individual and not as the qualifying agent of any corporation or

other business organization.

2. At all times material hereto, Henry Pena was the sole

officer and director of U.S.A. Henry Roofing Corp., a Florida

corporation. Neither Henry Pena nor U.S.A. Henry Roofing Corp.

(hereinafter jointly referred to as "Pena"), were registered,

certified, or otherwise qualified under the provisions of Chapter

489, Florida Statutes, to engage in contracting in the State of

Florida. Respondent was clearly aware of Pena's lack of

licensure. 1

The Zapata job

3. Pertinent to this case, Oscar and Consuelo Zapata owned

a one-story commercial building located at 59 Beacom Boulevard,

Miami, Florida.

4. On August 1, 1996, 2 Mr. Pena, on behalf of U.S.A. Henry

Roofing Corp., and Mr. Zapata entered into an agreement whereby

U.S.A. Henry Roofing Corp. would replace the roof on the building

in exchange for an agreed price of $18,200. A first payment of

$8,000 was to be paid after the first inspection, and the balance

of $10,200 was to be paid following the final inspection.

5. Later in the month of August, Mr. Pena presented a

building and zoning permit application, as well as a request for

permit, to Mr. Zapata (as owner of the property) for signature.

(Petitioner's Exhibit 8.) Following Mr. Zapata's signing,

Mr. Pena delivered the forms to Respondent who signed as the

contractor. Thereafter, on or about September 3, 1996,

Respondent submitted the forms to the City of Miami to obtain a

building permit for the re-roofing job. Respondent was not then,

nor was he ever, under contract to make improvements to the

Zapata property, and his sole involvement was to obtain a permit

so Pena could proceed with the job. The permit was issued on or

about September 5, 1996. 3

6. On September 17, 1996, Pena began work on the roof, and

ceased work the same day when the roof collapsed. 4 With the

discovery that Pena was not licensed or insured, Mr. Zapata

ultimately contracted with another company (that was licensed) to

re-roof the building for $16,000. That contract was duly

fulfilled, and the re-roofing of the Zapata building was

accomplished (notwithstanding the roof collapse) without

financial loss to the Zapatas. 5

Respondent's lapse of insurance coverage

7. Respondent's liability and property damage insurance

policy was terminated June 25, 1996, and was not reinstated until

September 19, 1996. Respondent does not dispute the lapse in

insurance coverage. (Petitioner's Exhibits 6 and 10, and

Transcript, at pages 76-77, and 80-81.)

The costs of investigation and prosecution

8. At hearing, the Department offered proof, without

objection, that its costs of investigation and prosecution,

excluding costs associated with any attorney's time, totalled

$306.09, as of January 27, 1999. (Petitioner's Exhibit 7.)

Previous disciplinary action

9. On January 18, 1996, the Department entered a final

order which found the Respondent guilty of the violations set

forth in a two-count Administrative Complaint issued March 25,

1993. (Petitioner's Exhibit 1.) In that complaint, the

Department charged (in Count I) that Respondent violated the

provisions of Subsection 489.129(1)(e), Florida Statutes, "by

performing any act which assists a person or entity in engaging

in the prohibited uncertified and unregistered practice of

contracting, if the cerfificateholder or registrant knows or has

reasonable grounds to know that the person or entity was

uncertified and unregistered," and (in Count II) that Respondent

violated the provisions of Subsection 489.129(1)(m), Florida

Statutes, "by being found guilty of fraud, deceit, or of gross

negligence, incompetency, or misconduct in the practice of

contracting." Such charges were premised on a renovation

contract Respondent held wherein he "subcontracted Nelson

Echeverria [who was not a state licensed electrical contractor]

to perform electrical work at customer's home for approximately

$4,500.00." The final order found Respondent guilty of the

charges, and imposed an administrative fine of $1,500 and costs

of $1,433.03, to be paid within 30 days. On March 8, 1996,

Respondent's license was suspended for failure to satisfy the

penalty imposed by the final order; however, the penalty was then

apparently satisfied and on June 19, 1996, the suspension was

lifted and Respondent's license was reinstated.

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.

11. 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).

12. Regardless of the disciplinary action sought to be

taken, it 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). Moreover, in determining whether Respondent

violated the provisions of Section 489.129(1), Florida Statutes,

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).

13. Pertinent to this case, Section 489.129, Florida

Statutes, provides:

(1) The board may take any of the

following actions against any

certificateholder or registrant: place on

probation or reprimand the licensee, revoke,

suspend, or deny the issuance or renewal of

the certificate or registration, require

financial restitution to a consumer for

financial harm directly related to a

violation of a provision of this part, impose

an administrative fine not to exceed $5,000

per violation, require continuing education,

or assess costs associated with investigation

and prosecution, if the contractor,

financially responsible officer, or business

organization for which the contractor is a

primary qualifying agent, a financially

responsible officer, or a secondary

qualifying agent responsible under s.

489.1195 is found guilty of any of the

following acts:

* * *

(e) Performing any act which assists a

person or entity in engaging in the

prohibited uncertified and unregistered

practice of contracting, if the

certificateholder or registrant knows or has

reasonable grounds to know that the person or

entity was uncertified and unregistered.

* * *

(j) Failing in any material respect to

comply with the provisions of this part or

violating a rule or lawful order of the

board.

* * *

(n) Committing incompetency or misconduct

in the practice of contracting.

14. In resolving whether Respondent assisted a person or

entity to engage in the prohibited uncertified and unregistered

practice of contacting, as alleged in Count I of the

Administrative Complaint and proscribed by Subsection

489.129(1)(e), Florida Statutes, the following definition should

be considered:

(6) "Contracting" means, except as

exempted in this part, engaging in business

as a contractor and includes, but is not

limited to, performance of any of the acts as

set forth in subsection (3) which define

types of contractors. The attempted sale of

contracting services and the negotiation or

bid for a contract on these services also

constitutes contracting. If the services

offered require licensure or agent

qualification, the offering, negotiation for

a bid, or attempted sale of these services

requires the corresponding licensure. . . .

Section 489.105(6), Florida Statutes.

15. Subsection 489.105, Florida Statutes, defines the

following types of contractors:

(3) "Contractor" means the person who is

qualified for, and shall only be responsible

for, the project contracted for and means,

except as exempted in this part, the person

who, for compensation, undertakes to, submits

a bid to, or does himself or herself or by

others construct, repair, alter, remodel, add

to, demolish, subtract from, or improve any

building or structure, including related

improvements to real estate, for others or

for resale to others; and whose job scope is

substantially similar to the job scope

described in one of the subsequent paragraphs

of this subsection. . . .

(a) "General contractor" means a

contractor whose services are unlimited as to

the type of work which he or she may do,

except as provided in this part.

* * *

(e) "Roofing contractor" means a

contractor whose services are unlimited in

the roofing trade and who has the experience,

knowledge, and skill to install, maintain,

repair, alter, extend, or design, when not

prohibited by law, and use materials and

items used in the installation, maintenance,

extension, and alteration of all kinds of

roofing, waterproofing, and coating, except

when coating is not represented to protect,

repair, waterproof, stop leaks, or extend the

life of the roof.

16. Also pertinent to Count I, Section 489.113, Florida

Statutes, imposes the following restriction on a general

contractor's practice:

(3) A contractor shall subcontract all

electrical, mechanical, plumbing, roofing,

sheet metal, swimming pool, and air-

conditioning work, unless such contractor

holds a state certificate or registration in

the respective trade category, however:

* * *

(g) No general, building, or residential

contractor certified after 1973 shall act as,

hold himself or herself out to be, or

advertise himself or herself to be a roofing

contractor unless he or she is certified or

registered as a roofing contractor.

17. Given the facts, as found, it cannot be subject to

serious debate that, with regard to the Zapata project, Pena

engaged in contracting, and that Respondent assisted or abetted

that activity by procuring the building permit for the project.

Consequently, Respondent is guilty of having violated Section

489.129(1)(e), Florida Statutes, as alleged in Count I of the

Administrative Complaint.

18. To support its contention that Respondent failed to

comply with the provisions of Chapter 489, Part I, Florida

Statutes, as alleged in Count II of the Administrative Complaint

and as proscribed by Subsection 489.129(1)(e), Florida Statutes,

the Department relies on Subsection 489.127(4)(c), Florida

Statutes, previously 489.1265, Florida Statutes (1995), which

provides as follows:

(c) A certified or registered contractor,

or contractor authorized by a local

construction regulation board to do

contracting, may not apply for or obtain a

building permit for construction work unless

the certified or registered contractor, or

contractor authorized by a local construction

regulation board to do contracting, or

business organization duly qualified by said

contractor, has entered into a contract to

make improvements to, or perform the

contracting at, the real property specified

in the application or permit. This paragraph

does not prohibit a contractor from applying

for or obtaining a building permit to allow

the contractor to perform work for another

person without compensation or to perform

work on property that is owned by the

contractor.

19. Here, the proof demonstrated, with the requisite degree

of certainty, that Respondent, within the meaning of Subsection

489.127(4)(c), applied for or obtained a building permit for

construction work for which he had no contract to perform

improvements to the real property specified in the application or

permit. Consequently, Respondent is guilty of violating the

provisions of Subsection 489.129(1)(j), Florida Statutes, as

alleged in Count II of the Administrative Complaint.

20. To support its contention that Respondent committed

incompetency or misconduct in the practice of contracting, as

alleged in Count III of the Administrative Complaint and

proscribed by Subsection 489.129(1)(n), Florida Statutes, the

Department relies on the provisions of Chapter 61G4, Florida

Administrative Code. Pertinent to this issue, Rule 61G4-

15.003(1), Florida Administrative Code, provides:

(1) As a prerequisite to the initial

issuance, or the renewal of an active

certificate or registration or a change in

the status of an active certificate or

registration, the applicant shall submit a

signed affidavit attesting to the fact that

the applicant has obtained and will maintain

public liability and property damage

insurance, in the amounts stated herein for

the life of an active certificate or

registration and for the safety and welfare

of the public. It shall be a violation of

this rule for any licensee to fail to

continually maintain liability and property

damage insurance in amounts set forth herein.

Pursuant to subparagraph (2)(h) of the foregoing Rule, a general

contractor must maintain public liability insurance and property

damage insurance in the amount of $300,000 and $50,000,

respectively. Under the provisions of Rules 61G4-17.001(4)(b)

and 61G4-17.009, Florida Administrative Code, a violation of any

provision of Chapter 61G4, Florida Administrative Code, is

considered a violation of Subsection 489.129(1)(n), Florida

Statutes. Consequently, by having failed to maintain liability

and property damage insurance as required by Rule 61G4-15.003,

Florida Administrative Code, Respondent has been shown to have

committed incompetency or misconduct in the practice of

contracting as alleged in Count III of the Administrative

Complaint and proscribed by Subsection 489.129(1)(n), Florida

Statutes.

21. Having reached the foregoing conclusions, it remains to

resolve the appropriate penalty that should be imposed.

Pertinent to this issue, Rule 61G4-17.001, Florida Administrative

Code, provides the following guidelines to be used in

disciplinary cases under Chapter 489, absent aggravating or

mitigating circumstances:

(5) 489.129(1)(e): Assisting unlicensed

person to evade provision of Chapter 489.

First violation, $500 to $2,500 fine; repeat

violation, $2,500 to $5,000 fine and

suspension, or revocation.

* * *

(14) Misconduct or incompetency in the

practice of contracting as set forth in

Section 489.129(1)(n), Florida Statutes,

shall include, but is not limited to:

* * *

(b) Violation of any provision of Chapter

61G4, Florida Administrative Code, or Chapter

489, Part I, F.S.

* * *

(d) The following guidelines shall apply

to cases involving misconduct or incompetency

in the practice of contracting, absent

aggravating or mitigating circumstances:

* * *

2. Violation of any provision of Chapter

61G4, Florida Administrative Code, or Chapter

489, Part I, F.S. First violation, $500 to

$1,000 fine; repeat violations $1,000 to

$5,000 fine and suspension or revocation.

* * *

(20) For any violation occurring after

October 1, 1989, the board may assess the

costs of investigation and prosecution. The

assessment of such costs may be made in

addition to the penalties provided by these

guidelines without demonstration of

aggravating factors set forth in rule 61G4- 6

17.002.

The Rule does not provide a specific penalty to address a

violation of Subsection 489.129(j), Florida Statutes, based on

violation of Section 489.127(4), Florida Statutes. See Rule

61G4-17.001(10), Florida Administrative Code. However, Rule

61G4-17.001(22), Florida Administrative Code, provides that

"[t]he absence of any violation from this Chapter shall be viewed

as an oversight, and shall not be construed as an indication that

no penalty is to be assessed. The Guideline penalty for the

offense most closely resembling the omitted offense shall apply."

22. According to Rule 61G4-17.002, Florida Administrative

Code, the circumstances which may be considered in mitigation or

aggravation of the penalty include, but are not limited to, the

following:

(1) Monetary or other damage to the

licensee's customer, in any way associated

with the violation, which damage the licensee

has not relieved, as of the time the penalty

is to be assessed. (This provision shall not

be given effect to the extent it would

contravene federal bankruptcy law.)

(2) Actual job-site violations of building

codes, or conditions exhibiting gross

negligence, incompetence, or misconduct by

the licensee, which have not been corrected

as of the time the penalty is being assessed.

(3) The severity of the offense.

(4) The danger to the public.

(5) The number of repetitions of offenses.

(6) The number of complaints filed against

the licensee.

(7) The length of time the licensee has

practiced.

(8) The actual damage, physical or

otherwise, to the licensee's customer.

(9) The deterrent effect of the penalty

imposed.

(10) The effect of the penalty upon the

licensee's livelihood.

(11) Any efforts at rehabilitation.

(12) Any other mitigating or aggravating

circumstances.

23. The Department's proposed recommended order suggests,

as a penalty for the violations found, the imposition of a $5,000

administrative fine; assessment of the costs of investigation and

prosecution of $306.09; and, the suspension of Respondent's

license for a period of one year, followed by a two-year term of

probation. Given the repetitive nature of Respondent's

violation, the Department's proposal is consistent with the

provisions of Section 489.129(1), Florida Statutes, the penalty

guidelines established by Rule 61G4-17.001, Florida

Administrative Code, and the mitigation and aggravation factors

established by Rule 61G4-17.002, Florida Administrative Code.

Consequently, the Department's recommendation is accepted as

appropriate under the circumstances of this case.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED that a final order be entered finding Respondent

guilty of the violations alleged in Counts I through III of the

Administrative Complaint and imposing, as a penalty for such

violations, an administrative fine in the sum of $5,000;

assessing costs of investigation and prosecution in the sum of

$306.09; and, suspending Respondent's licensure for a period of

one year, followed by a two-year term of probation subject to

such reasonable terms and conditions as the Construction Industry

Licensing Board may impose.

DONE AND ENTERED this 12th day of May, 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 May, 1999.

ENDNOTES

1/ Such conclusion is supported by the menial nature of the tasks

Respondent had historically employed Pena to perform ("hot mop"

roofs) and, most importantly, when Respondent applied for and

obtained the building permit (at the request of Pena) for the

Zapata job, discussed infra . Clearly, had Pena been licensed, it

would have been unnecessary for Respondent to pull the permit.

Notably, Respondent offered no proof to the contrary at hearing.

2/ The agreement (Petitioner's Exhibit 9) reveals a date of

"01/08/96" which should be read day/month/year.

3/ The permit erroneously noted the job address as 39 Beacom

Boulevard, as opposed to 59 Beacom Boulevard. (Petitioner's

Exhibit 8.)

4/ No proof was offered to establish the cause of the roof

collapse.

5/ The only monies Mr. Zapata expended were for some roofing

materials ordered by Mr. Pena, and which Mr. Pena removed from the

job site. No proof was offered at hearing regarding the cost or

value of those materials.

6/ Consistent with the provisions of Section 489.129(1), Florida

Statutes, Rule 61G4-17.001(21), Florida Administrative Code,

provides "the board may order the contractor to make restitution

in the amount of financial loss suffered by the consumer." Here,

the proof does not demonstrate that the customer suffered any

financial loss and, consequently, the Department seeks no such

requirement.

COPIES FURNISHED:

Theodore R. Gay, Esquire

Department of Business and

Professional Regulation

401 Northwest Second Avenue

Suite N-607

Miami, Florida 33128

Jorge E. Otero, Esquire

Tomlin & Tomlin, P.A.

75 Valencia Avenue, 4th Floor

Coral Gables, Florida 33134

Rodney Hurst, Executive Director

Construction Industry Licensing Board

Department of Business and

Professional Regulation

7960 Arlington Expressway, Suite 300

Jacksonville, Florida 32211-7467

William Woodyard, 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.