99-000408 Florida Real Estate Commission vs. Yvonne Joiner Mediate And Royal Realty And Management, Inc.
 Status: Closed
Recommended Order on Monday, June 28, 1999.


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Summary: Respondents violated Sections 475.25 (1) (e) and (k), Florida Statutes, by distributing buyer`s deposit without instructions from buyer.

1STATE OF FLORIDA

4DIVISION OF ADMINISTRATIVE HEARINGS

8DEPARTMENT OF BUSINESS AND )

13PROFESSIONAL REGULATION, )

16DIVISION OF REAL ESTATE, )

21)

22Petitioner, )

24)

25vs. ) Case No. 99-0408

30)

31YVONNE JOINER MEDIATE and )

36ROYAL REALTY & MANAGEMENT, )

41INC., )

43)

44Respondents. )

46_________________________________)

47RECOMMENDED ORDER

49Pursuant to notice, a formal hearing was held in this case

60before Larry J. Sartin, a duly designated Administrative Law

69Judge of the Division of Administrative Hearings, on May 5, 1999,

80in Tallahassee, Florida.

83APPEARANCES

84For Petitioner: Daniel Villazon, Chief Attorney

90Division of Real Estate

94Department of Business and Professional

99Regulation

100Hurston North Tower, Suite N308

105400 West Robinson Street

109Orlando, Florida 3280 1-1772

113For Respondents: No Appearance

117STATEMENT OF THE ISSUE

121The issue in this case is whether Respondents, Yvonne Joiner

131Mediate and Royal Realty Management, Inc., committed the offenses

140alleged in an Administrative Complaint issued against Respondents

148on or about November 18, 1998.

154PRELIMINARY STATEMENT

156On November 18, 1998, the Department of Business and

165Professional Regulation, issued an Administrative Complaint

171alleging that Respondents, Yvonne Joiner Mediate and Royal Realty

180Management, Inc., violated Section 475.25(1)(e), Florida Statutes

187(by failing to institute one of the procedures specified in

197Section 475.25(1)(d)1, Florida Statutes, in violation of Rule

20561J2-10.032(1), Florida Administrative Code), and 475.25(1)(k),

211Florida Statutes. By letter dated January 10, 1999, Ms. Joiner

221disputed the allegations of fact of the Administrative Complaint

230and suggested that the allegations be dropped.

237Although Ms. Joiner did not request a formal administrative

246hearing to contest the allegations of the Administrative

254Complaint, copies of the complaint and the letter were filed with

265the Division of Administrative Hearings on January 28, 1999, by

275Petitioner requesting assignment of the matter to an

283Administrative Law Judge. The matter was assigned to the

292undersigned.

293An Initial Order was entered and mailed to Petitioner and

303Respondents requesting information concerning the scheduling of

310the formal hearing. The Initial Order was mailed to Respondents

320at the address used by Ms. Joiner in her letter of January 10,

3331999. Petitioner responded to the Order. Respondent filed no

342response.

343On March 14, 1999, a Notice of Hearing was entered

353scheduling the hearing to commence at 1:00 p.m. on May 5, 1999.

365The Notice was also sent to Respondents at the address used by

377Ms. Joiner in her letter of January 10, 1999.

386On the date scheduled for the hearing counsel for Petitioner

396appeared. Respondent, however, failed to appear. After waiting

404fifteen minutes for Respondent, the hearing proceeded. At no

413time during or after the hearing did Respondent make an

423appearance or inform the undersigned of any reason for her

433failure to appear.

436Petitioner presented the testimony of Clifford Brown and

444Sidney B. Miller. Petitioner's Exhibits 1 through 4 were

453accepted into evidence.

456A Transcript of the hearing was filed on May 5, 1999.

467Proposed orders were, therefore, due on or before June 1, 1999.

478Petitioner filed a proposed order on June 2, 1999. The proposed

489order has been fully considered in entering this Recommended

498Order.

499FINDINGS OF FACT

5021. Petitioner, the Department of Business and Professional

510Regulation, Division of Real Estate (hereinafter referred to as

519the "Division"), is an agency of the State of Florida. The

531Division is charged with the responsibility for, among other

540things, regulating the practice of persons holding real estate

549brokers' and real estate sales persons' licenses in Florida.

558Section 20.165, and Chapters 455 and 475, Florida Statutes.

5672. Respondent, Yvonne Joiner Mediate, is now, and at all

577times relevant to this matter was, licensed as a real estate

588broker in Florida.

5913. Respondent, Royal Realty & Management, Inc. (hereinafter

599referred to as "Royal Realty"), is now, and at all times relevant

612to this matter was, a corporation registered as a real estate

623broker in Florida. Royal Realty's license number is 0255570.

632Royal Realty's last reported address is 1885 U.S. 19, Post Office

643Box 788, Monticello, Florida 32344.

6484. Until December 31, 1998, Ms. Mediate was the active,

658qualifying broker for, and an officer of, Royal Realty. Since

668December 31, 1998, Ms. Mediate has been an inactive broker.

6785. On or about May 15, 1994, Clifford Brown entered into a

690Contract for Sale and Purchase (hereinafter referred to as the

"700Purchase Contract"), with Ralph and Dawn Chapman, agreeing to

710purchase certain real property from the Chapmans.

7176. Consistent with the Purchase Contract, Mr. Brown

725remitted a $1,000.00 deposit with Ms. Mediate and Royal Realty.

7367. The Purchase Contract was contingent upon Mr. Brown's

745obtaining financing for the balance of the purchase price through

755a third-party loan.

7588. Closing on the Purchase Contract was originally

766scheduled for June 15, 1994. The date for closing was

776subsequently extended to June 30, 1994.

7829. Mr. Brown ultimately failed to obtain the required

791third-party loan. As a consequence, closing on the Purchase

800Contract did not take place.

80510. Even though Mr. Brown had defaulted on the Purchase

815Contract, neither party took any action to cancel the Purchase

825Contract immediately.

82711. In October 1994 Mr. Brown had still not obtained

837financing. Therefore, Respondents, without Mr. Brown's consent,

844disbursed part of the $1,000.00 deposit to the Chapman's and part

856to a title insurance company.

86112. When Mr. Brown requested the return of his deposit,

871Ms. Mediate informed him that he had forfeited the deposit

881because he had failed to obtain a third-party loan.

89013. On or about January 28, 1998, more than three years

901after disbursing the deposit, Ms. Mediate notified the Division

910that there was a dispute over whom Mr. Brown's deposit should be

922disbursed to.

92414. On or about November 18, 1998, an Administrative

933Complaint was issued against Respondents. Respondents were both

941charged with violating Sections 475.25(1)(e) (by failing to

949institute one of the procedures specified in Section

957475.25(1)(d)1, Florida Statutes in violation of Rule 61J2-

96510.032(1), Florida Administrative Code), and (k), Florida

972Statutes.

973CONCLUSIONS OF LAW

97615. The Division of Administrative Hearings has

983jurisdiction of the parties to, and the subject matter of, this

994proceeding. Section 120.57, Florida Statutes (1997).

100016. The burden of proof in this proceeding was on the

1011Division, the party asserting the affirmative of the issue: that

1021Respondents committed violations of Section 475.25(1), Florida

1028Statutes. See Florida Department of Transportation v. J.W.C.

1036Company, Inc. , 396 So. 2d 778 (Fla. 1st DCA 1981); Balino v.

1048Department of Health and Rehabilitative Services , 348 So. 2d 349

1058(Fla. 1st DCA 1977). The Division was required to meet its

1069burden by clear and convincing evidence. Ferris v. Turlington ,

1078510 So. 2d 292 (Fla. 1987).

108417. Section 475.25, Florida Statutes (1997), authorizes the

1092Florida Real Estate Commission to take disciplinary action

1100against the license of any real estate broker or real estate

1111salesperson if the licensee commits certain specified acts. Of

1120the specified acts of Section 475.23, Florida Statutes,

1128Respondents were charged with violating the following:

1135. . . .

1139(e) Has violated any of the provisions of this

1148chapter or any lawful order or rule made or

1157issued, under the provisions of this chapter or

1165chapter 455.

1167. . . .

1171(k) Has failed, if a broker, to immediately

1179place, upon receipt, any money, fund, deposit,

1186check, or draft entrusted to her or him by any

1196person dealing with her or him as a broker in

1206escrow with a title company, banking institution,

1213credit union, or savings and loan association

1220located and doing business in this state, or to

1229deposit such funds in a trust or escrow account

1238maintained by her or him with some bank, credit

1247union, or savings and loan association located

1254and doing business in this state, wherein the

1262funds shall be kept until disbursement thereof is

1270properly authorized . . . . The commission shall

1279establish rules to provide for records to be

1287maintained by the broker and the manner in which

1296such deposits shall be made.

130118. As to Section 475.25(1)(e), Florida Statutes, the

1309specific rule which Respondents were charged with having violated

1318is Rule 61J2-10.032(1), Florida Administrative Code:

1324(1)(a) A real estate broker, upon receiving

1331conflicting demands for any trust funds being

1338maintained in the broker's escrow account, must

1345provide written notification to the Commission

1351within 15 business days of the last party's

1359demand, and the broker must institute one of the

1368settlement procedures as set forth in s.

1375475.25(1)(d)1., Florida Statutes, within 30

1380business days after the last demand.

1386(b) A broker, who has good faith doubt as to

1396whom is entitled to any trust funds held in the

1406broker's escrow account, must provide written

1412notification to the Commission within 15 business

1419days after having such doubt and must institute

1427one of the settlement procedures as set forth in

1436s. 475.25(1)(d)1., Florida Statutes, within 30

1442business days after having such doubt. Based

1449upon prior decisions of the Commission, good

1456faith doubt shall be deemed to exist in the

1465following situations:

14671. the closing or consummation date of the

1475sale, lease, or other real estate transaction has

1483passed and the broker has not received

1490conflicting or identical instructions from all of

1497the parties concerning the disbursement of the

1504escrowed funds;

150619. Respondents were charged with violating the foregoing

1514rule by failing to follow one of the procedures for dealing with

1526a dispute over the disbursement of escrowed funds established in

1536Section 475.25(1)(d)1, Florida Statutes:

1540(d)1. Has failed to account or deliver to any

1549person, including a licensee under this chapter,

1556at the time which has been agreed upon or is

1566required by law or, in the absence of a fixed

1576time, upon demand of the person entitled to such

1585accounting and delivery, any personal property

1591such as money, fund, deposit, check, draft,

1598abstract of title, mortgage, conveyance, lease,

1604or other document or thing of value, including a

1613share of a real estate commission . . . .

1623However, if the licensee, in good faith,

1630entertains doubt as to what person is entitled to

1639the accounting and delivery of the escrowed

1646property, or if conflicting demands have been

1653made upon the licensee for the escrowed property,

1661which property she or he still maintains in her

1670or his escrow or trust account, the licensee

1678shall promptly notify the commission of such

1685doubts or conflicting demands and shall promptly:

1692a. Request that the commission issue an escrow

1700disbursement order determining who is entitled to

1707the escrowed property;

1710b. With the consent of the parties, submit the

1719matter to arbitration;

1722c. By interpleader or otherwise, seek

1728adjudication of the matter by a court; or

1736d. With the written consent of all parties,

1744submit the matter to mediation. . . .

1752If the licensee promptly employs one of the

1760escape procedures contained herein, and if she or

1768he abides by the order or judgment resulting

1776therefrom, no administrative compliant may be

1782filed against the licensee for failure to account

1790for, deliver, or maintain the escrowed property.

179720. Respondents had no right to disburse the deposit

1806tendered to them by Mr. Brown. The rules governing brokers are

1817clear that such funds may not be disbursed until after a

1828transaction closes without the consent of the depositor of the

1838funds. Rule 61J2-14.011, Florida Administrative Code. In this

1846case, closing never took place and Mr. Brown never gave any

1857instructions authorizing disbursement of the funds.

186321. Pursuant to Rule 62J2-10.032(1), Florida Administrative

1870Code, when the date for closing on the Purchase Contract, June

188130, 1994, passed, and Respondents received no conflicting or

1890identical instructions concerning the disbursement of Mr. Brown's

1898deposit, Respondents were deemed to have good faith doubt as to

1909how the funds should be disbursed.

191522. Despite Respondents' good faith doubt as to how Mr.

1925Brown's deposit should be disbursed, Respondents disbursed the

1933funds to the sellers and a title company. Respondent's

1942therefore, disbursed funds placed in their trust without

1950following the procedures specified in Section 475.25(1)(d)1,

1957Florida Statutes.

195923. Based upon the foregoing, Respondents did in fact

1968violate Section 475.25(1)(e), Florida Statutes, by failing to

1976following one of the specified procedures of Section

1984475.25(1)(d)1, Florida Statutes, contrary to Rule 61J2-10.032(1),

1991Florida Administrative Code, as alleged in the Administrative

1999Complaint.

200024. Respondents' disbursement of Mr. Brown's deposit before

2008authorization from Mr. Brown to do so also violated Section

2018475.25(1)(k), Florida Statutes.

202125. The Division has requested that Ms. Mediate be placed

2031on probation for a period of one year from the entry of the final

2045order in this case; that she be required to successfully complete

2056a seven-hour escrow management course for real estate brokers;

2065and that she be required to pay an administrative fine of

2076$1,000.00.

207826. The Division has requested that Royal Realty &

2087Management, Inc., be issued a written reprimand.

209427. The punishment recommended by the Division is

2102consistent with Rule 61J2-24.001, Florida Administrative Code.

2109While the range of penalties provided for a violation of Section

2120475.25(1)(e), Florida Statutes, may be more severe than the

2129penalties recommended by the Division, a consideration of the

2138aggravating and mitigating circumstances supports the Division's

2145recommendation.

2146RECOMMENDATION

2147Based on the foregoing Findings of Fact and Conclusions of

2157Law, it is

2160RECOMMENDED that a final order be entered by Petitioner

2169finding that Respondents have violated Sections 475.25(1)(e) and

2177(k), Florida Statutes, as alleged in the Administrative Complaint

2186issued against Respondents. It is further

2192RECOMMENDED that Respondent Yvonne Joiner Mediate be placed

2200on probation for a period of one year from the entry of the final

2214order; that she be required to successfully complete a seven hour

2225escrow management course for real estate brokers; and that she be

2236required to pay an administrative fine of $1,000.00. It is

2247further

2248RECOMMENDED that Respondent Royal Realty & Management, Inc.,

2256be issued a written reprimand.

2261DONE AND ENTERED this 28th day of June, 1999, in

2271Tallahassee, Leon County, Florida.

2275___________________________________

2276LAR RY J. SARTIN

2280Administrative Law Judge

2283Division of Administrative Hearings

2287The DeSoto Building

22901230 Apalachee Parkway

2293Tallahassee, Florida 32399-3060

2296(850) 488-9675 SUNCOM 278-9675

2300Fax Filing (850) 921-6847

2304www.doah.state.fl.us

2305Filed with the Clerk of the

2311Division of Administrative Hearings

2315this 28th day of June, 1999.

2321COPIES FURNISHED:

2323Daniel Villazon, Chief Attorney

2327Division of Real Estate

2331Department of Business and Professional

2336Regulation

2337Hurston North Tower, Suite N308

2342400 West Robinson Street

2346Orlando, Florida 32801-1772

2349Yvonne Mediate

2351U.S. Highway 19, South

2355Post Office Box 788

2359Monticello, Florida 32344

2362Herbert S. Fecker, Division Director

2367Division of Real Estate

2371Department of Business

2374and Professional Regulation

2377400 West Robinson Street

2381Post Office Box 1900

2385Orlando, Florida 32802-1900

2388William Woodyard, General Counsel

2392Department of Business

2395and Professional Regulation

23981940 North Monroe Street

2402Northwood Centre

2404Tallahassee, Florida 32933-1920

2407NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

2413All parties have the right to submit written exceptions within 15

2424days from the date of this recommended order. Any exceptions to

2435this recommended order should be filed with the agency that will

2446issue the final order in this case.

Select the PDF icon to view the document.
PDF
Date
Proceedings
Date: 09/16/1999
Proceedings: Final Order filed.
PDF:
Date: 09/15/1999
Proceedings: Agency Final Order
PDF:
Date: 09/15/1999
Proceedings: Recommended Order
PDF:
Date: 06/28/1999
Proceedings: Recommended Order sent out. CASE CLOSED. Hearing held 05/05/99.
Date: 06/02/1999
Proceedings: Proposed Recommended Order (Petitioner) (filed via facsimile).
Date: 05/20/1999
Proceedings: Transcript filed.
Date: 05/05/1999
Proceedings: CASE STATUS: Hearing Held.
Date: 03/22/1999
Proceedings: (Petitioner) Notice of Substitute Counsel (filed via facsimile).
Date: 03/10/1999
Proceedings: Notice of Hearing sent out. (hearing set for 5/5/99; 1:00pm; Tallahassee)
Date: 02/09/1999
Proceedings: (Petitioner) Unilateral Response to Initial Order (filed via facsimile).
Date: 02/01/1999
Proceedings: Initial Order issued.
Date: 01/28/1999
Proceedings: Agency Referral Letter; Administrative Complaint; Request for Hearing (letter) rec`d

Case Information

Judge:
LARRY J. SARTIN
Date Filed:
01/28/1999
Date Assignment:
02/01/1999
Last Docket Entry:
09/16/1999
Location:
Monticello, Florida
District:
Northern
Agency:
ADOPTED IN TOTO
 

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