99-004702 Department Of Business And Professional Regulation, Division Of Real Estate vs. Collie E. Stevens Status: Closed Recommended Order on Monday, June 19, 2000.

Summary: Respondent broker failed to return earnest money to buyer as directed by seller, as broker made his own claims on funds. Violations of Section 475.25(1)(d) and (o), F.S., were proven as, for second time, broker failed to properly maintain trust funds.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case No. 99-4702

)

COLLIE E. STEVENS, )

)

Respondent. )

___________________________________)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings,

by its duly-designated Administrative Law Judge, Mary Clark, held

a formal hearing in the above-styled case by videoconference on

April 20, 2000. The Administrative Law Judge presided from a

videoconference center in Tallahassee, Florida; the parties,

their witnesses, and the court reporter participated from a

videoconference center in Orlando, Florida.

APPEARANCES

For Petitioner: Andrea D. Perkins, Esquire

Department of Business and

Professional Regulation

400 West Robinson Street, Suite 308N

Orlando, Florida 32801-1772

For Respondent: Collie E. Stevens, pro se

Son Set Free Realty, Inc.

2294 North U.S. One

Fort Pierce, Florida 34950

STATEMENT OF THE ISSUE

An Administrative complaint dated April 13, 1999, alleges

that Respondent Mr. Stevens violated several provisions of

Section 475.25, Florida Statutes, when he failed to return an

earnest money deposit to a buyer after being directed to do so by

the seller, the U.S. Department of Veterans Affairs. The issues

in this proceeding are whether Mr. Stevens committed the

violation and if so what discipline is appropriate.

PRELIMINARY STATEMENT

Mr. Stevens requested a formal hearing in response to the

Administrative Complaint; the case was then forwarded to the

Division of Administrative Hearings where it was assigned and set

for hearing as described above.

At hearing the Division of Real Estate (Agency) presented

one witness and five exhibits, received in evidence as

Petitioner's Exhibit Nos. 1-5. Mr. Stevens testified in his own

behalf and presented three exhibits which were received into

evidence as Respondent's Exhibit Nos. 1-3.

The Transcript of the proceeding was filed on May 19, 2000.

The Agency filed its Proposed Recommended Order on May 31, 2000.

Mr. Stevens did not file any proposals.

FINDINGS OF FACT

1. Respondent, Collie E. Stevens, has been licensed in the

State of Florida as a real estate broker since 1986. Prior to

that year he was licensed as a real estate salesperson in

Florida.

2. In 1996 Mr. Stevens repr esented the seller, the U.S.

Department of Veterans Affairs (VA), in the sale of a home in

Orange County, Florida. On October 1, 1996, Doris Wright

executed an Offer to Purchase and Contract of Sale for the home.

3. When she signed the contract Ms. Wright gave the broker,

Mr. Stevens, a check for $675.00 as an earnest money deposit.

Mr. Stevens deposited the check into his escrow account.

4. Later, in October or November 1996, Ms. Wright withdrew

her offer to purchase the property. The VA regional office

provided a notice to Mr. Stevens dated November 20, 1996,

directing him to return the earnest money deposit to Ms. Wright.

5. Mr. Stevens never returned the money to Ms. Wright

although she made several requests through his secretary and made

several attempts to contact him directly.

6. Mr. Stevens alleges that he is entitled to retain at

least $250.00 of the $675.00 deposit because that was the

mortgage company's fee for processing Ms. Wright's mortgage

application. Mr. Stevens claims that Ms. Wright authorized him

to pay that fee on her behalf when she was not in town; Ms.

Wright does not dispute that claim.

7. Mr. Stevens also argues that he should be entitled to

the remainder of the deposit money because Ms. Wright cancelled a

listing agreement for him to sell her house. Ms. Wright disputes

this claim and Mr. Stevens did not produce any contract or

document evidencing such an agreement.

8. During the pendancy of his dispute with Ms. Wright over

entitlement to the deposit Mr. Stevens never notified the Florida

Real Estate Commission of the dispute nor did he submit the

matter to arbitration, mediation, or any court. Mr. Stevens

insists that he could have worked out his differences with Ms.

Wright and that he was always willing to give her $425.00, left

after deducting $250.00 for the processing fee from the $675.00

deposit.

9. In 1996, in another case, Mr. Stevens was disciplined by

the Florida Real Estate Commission for culpable negligence or

breach of trust, failure to give notice of his representation of

a party, failure to maintain trust funds in an escrow account,

and failure to preserve and make available brokerage records.

CONCLUSIONS OF LAW

10. The Division of Administrative Hearings has

jurisdiction in this proceeding pursuant to Sections 120.57(1)

and 455.225, Florida Statutes.

11. In a licensure discipline such as this the Agency has

the burden of proving by clear and convincing evidence the

allegations of its complaint. Department of Banking and Finance

v. Osborne Stein and Co. , 690 So. 2d 932 (Fla. 1996).

12. Based on his failure to return Ms. Wright's deposit,

the Agency has charged Mr. Stevens with violations of the

following:

475.25 Discipline

(1) The commission may deny an application

for licensure, registration, or permit, or

renewal thereof; may place a licensee,

registrant, or permittee on probation; may

suspend a license, registration, or permit

for a period not exceeding 10 years; may

revoke a license, registration, or permit;

may impose an administrative fine not to

exceed $1,000 for each count or separate

offense; and may issue a reprimand, and any

or all of the foregoing, if it finds that the

licensee, registrant, permittee, or

applicant:

(b) Has been guilty of fraud,

misrepresentation, concealment, false

promises, false pretenses, dishonest dealing

by trick, scheme, or device, culpable

negligence, or breach of trust in any

business transaction in this state or any

other state, nation, or territory; has

violated a duty imposed upon her or him by

law or by the terms of a listing contract,

written, oral, express, or implied, in a real

estate transaction; has aided, assisted, or

conspired with any other person engaged in

any such misconduct and in furtherance

thereof; or has formed an intent, design, or

scheme to engage in any such misconduct and

committed an overt act in furtherance of such

intent, design, or scheme. It is immaterial

to the guilt of the licensee that the victim

or intended victim of the misconduct has

sustained no damage or loss; that the damage

or loss has been settled and paid after

discovery of the misconduct; or that such

victim or intended victim was a customer or a

person in confidential relation with the

licensee or was an identified member of the

general public.

* * *

(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, including a share

of a real estate commission if a civil

judgment relating to the practice of the

licensee's profession has been obtained

against the licensee and said judgment has

not been satisfied in accordance with the

terms of the judgment within a reasonable

time, or any secret or illegal profit, or any

divisible share or portion thereof, which has

come into the licensee's hands and which is

not the licensee's property or which the

licensee is not in law or equity entitled to

retain under the circumstances. However, if

the licensee, in good faith, entertains doubt

as to what person is entitled to the

accounting and delivery of the escrowed

property, or if conflicting demands have been

made upon the licensee for the escrowed

property, which property she or he still

maintains in her or his escrow or trust

account, the licensee shall promptly notify

the commission of such doubts or conflicting

demands and shall promptly:

a. Request that the commission issue an

escrow disbursement order determining who is

entitled to the escrowed property;

b. With the consent of all parties, submit

the matter to arbitration;

c. By interpleader or otherwise, seek

adjudication of the matter by a court; or

d. With the written consent of all parties,

submit the matter to mediation. The

department may conduct mediation or may

contract with public or private entities for

mediation services. However, the mediation

process must be successfully completed within

90 days following the last demand or the

licensee shall promptly employ one of the

other escape procedures contained in this

section. Payment for mediation will be as

agreed to in writing by the parties. The

department may adopt rules to implement this

section.

If the licensee promptly employs one of the

escape procedures contained herein, and if

she or he abides by the order or judgment

resulting therefrom, no administrative

complaint may be filed against the licensee

for failure to account for, deliver, or

maintain the escrowed property.

2. Has failed to deposit money in an escrow

account when the licensee is the purchaser of

real estate under a contract where the

contract requires the purchaser to place

deposit money in an escrow account to be

applied to the purchase price if the sale is

consummated.

* * *

(o) Has been found guilty, for a second

time, of any misconduct that warrants her or

his suspension or has been found guilty of a

course of conduct or practices which show

that she or he is so incompetent, negligent,

dishonest, or untruthful that the money,

property, transactions, and rights of

investors, or those with whom she or he may

sustain a confidential relation, may not

safely be entrusted to her or him.

13. The Agency has met its burden of proof, as to the

latter two violations but not the first. The evidence suggests

Mr. Stevens' careless disregard or cavalier attitude toward his

duties as a broker rather than intentional fraud. Even after

direction by the seller he did nothing required in Subsection

475.25(1)(d)1., Florida Statutes, to resolve his own dispute with

Ms. Wright regarding her deposit.

14. Rule 61J2-14.011, Florida Administrative Code,

addresses the rights of brokers regarding escrow deposits. That

rule states that a "broker who receives a deposit shall not have

any right to or lien upon said deposit, except upon the written

agreement or order of the depositor so long as the depositor has

sole control of said deposit." That rule also permits a

depositor to "demand return of a deposit until such time as

another party has acquired some interest or equity." Further,

"such right to demand return of the deposit shall again accrue

upon a breach by the other party to the contract."

15. In this case Mr. Stevens ignored his duty to release

the funds to Ms. Wright. The transaction did not close and the

seller, the VA, specifically authorized its broker to release the

funds to Ms. Wright.

16. If Mr. Stevens ge nuinely thought he was entitled to the

funds, he should have obtained something in writing permitting

him to keep them and, failing that, he should have proceeded to

resolve the dispute as directed by statute and rule. Instead,

there is no evidence of even a letter to Ms. Wright notifying her

that he was taking the funds held in escrow. For a second time

Mr. Stevens abused the privileges of licensure as a real estate

broker and failed to appropriately manage funds held in escrow in

spite of prior discipline.

17. The penalty recommended by counsel for the Agency is

within the guidance range described in Rule 61J2-24, Florida

Administrative Code, for violations of Sections 475.25(1)(d) and

(o), Florida Statutes.

RECOMMENDATION

Based on the foregoing, it is

RECOMMENDED:

That the Florida Real Estate Commission issue a final order

finding that Collie E. Stevens is guilty of a violation of

Sections 475.25(1)(d)1. and 475.25(1)(0), Florida Statutes, as

charged in the Administrative Complaint, and that the Florida

Real Estate Commission suspend his license for two years and

require him to complete a 7-hour escrow management course and a

60-hour post-licensure course, and that he pay the costs

associated with this case.

DONE AND ENTERED this 19th day of June, 2000, in

Tallahassee, Leon County, Florida.

___________________________________

MARY CLARK

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 19th day of June, 2000.

COPIES FURNISHED:

Andrea D. Perkins, Esquire

Department of Business and

Professional Regulation

400 West Robinson Street, Suite 308N

Orlando, Florida 32801-1772

Collie E. Stevens

Son Set Free Realty, Inc.

2294 North U.S. One

Fort Pierce, Florida 34950

Herbert S. Fecker, Director

Division of Real Estate

Department of Business and Professional

Regulation

400 West Robinson Street

Post Office Box 1900

Orlando, Florida 32802-1900

Barbara D. Auger, General Counsel

Department of Business and Professional

Regulation

Northwood Centre

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 must be filed with the agency that will

issue the Final Order in this case.