03-002359 Sara Kaczmerek Schubert vs. Department Of Financial Services Status: Closed Recommended Order on Monday, January 26, 2004.

Summary: Petitioner advertised her bail bond agency name before she obtained a license. It is recommended that the license be issued on probation.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

SARA KACZMEREK SCHUBERT, )

)

Petitioner, )

)

vs. ) Case No. 03 - 2359

)

DEPARTMENT OF FINANCIAL )

SERVICES, )

)

Respondent. )

_________________________________)

RECOMMENDED ORDER

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

before Larry J. Sartin, an Administrative Law Judge of the

Division of Administrative Hearings, on November 17, 2003, in

Fort Lauderdale, Florida.

APPEARANCES

For Petitioner: Ramon de la Cabada, Esquire

Law Offices of Ramon de la Cabada, P.A.

3191 Coral Way, Suite 115

Miami, Florida 33145

For Respondent: Dickson E. Kesler, Esquire

Division of Legal Services

Department of Financial Services

401 Northwest 2nd Avenue, Suite N - 321

Miami, Florida 3312 8

Dana M. Wiehle, Esquire

Division of Legal Services

Department of Financial Services

200 East Gaines Street

Tallahassee, Florida 32399 - 0333

STATEMENT OF THE ISSUE

The issue in this case is whether Petitioner, Sara

Kaczmerek Schubert, should be li censed as a limited surety (bail

bond) agent pursuant to Chapter 648, Florida Statutes.

PRELIMINARY STATEMENT

In October 2002 Petitioner filed an application with

Respondent, the Department of Financial Services, seeking

licensure as a limited surety (bail bond) agent. 1 By letter

dated April 18, 2003, Respondent informed Petitioner that her

application was denied.

On or about April 23, 2003, Petitioner executed an Election

of Proceeding Form disputing the facts alleged by Respondent in

support of its preli minary decision to deny her application and

requesting a formal administrative hearing. By letter dated

June 24, 2003, Respondent filed Petitioner's request for hearing

with the Division of Administrative Hearings. The request for

hearing was designated case number 03 - 2359 and was assigned to

the undersigned.

On July 14, 2003, Respondent filed a Motion for Leave to

Amend Denial Letter. Respondent sought leave to amend its

April 18, 2003, denial letter by adding two statutory references

in support of its decision. It was represented in the Motion

that Petitioner did not object to the Motion. By Order entered

July 17, 2003, the Motion was granted.

At the final hearing of this matter, Petitioner testified

on her own behalf and presented the testimony of Ja mes A. Moore.

Three exhibits, Petitioner's Exhibits numbered 1 through 3, were

offered and admitted. Respondent presented the testimony of

Hazel Muhammad, Glenda Ostreich, Patricia Anthony, Ronald S.

Blum, and Petitioner. Twenty - four exhibits, Responden t's

Exhibits number 1 through 24, were offered and admitted.

Portions of the deposition testimony of Petitioner, offered by

Respondent, were also accepted.

At the commencement of the final hearing, the parties filed

a Pre - Hearing Fact Stipulation, contain ing facts which the

parties had agreed upon. Those stipulated facts have been

incorporated into this Recommended Order.

On December 5, 2003, the Transcript of the final hearing,

consisting of two volumes, was filed with the Division of

Administrative Hear ings. Proposed recommended orders were,

therefore, to be filed on or before December 15, 2003. An

extension of time until December 22, 2003, was requested by

Respondent on behalf of the parties. The extension was granted.

Both parties filed proposed re commended orders on December 22,

2003. Those post - hearing submittals have been fully considered.

FINDINGS OF FACT

A. The Parties .

1. Respondent, the Department of Financial Services

(hereinafter referred to as the "Department"), is the state

agency res ponsible for, among other things, licensing of

temporary bail bond agents and bail bond agents in the State of

Florida. Chap. 648, Fla. Stat. In particular, the Department's

Division of Agent and Agency Services, Bureau of Licensing, has

been designated within the Department to review applications and

make decisions thereon.

2. Petitioner, Sara Kaczmerek Schubert, is an individual

residing in Florida who is seeking licensure as a bail bond

agent.

B. Ms. Schubert's Temporary Bail Bond Agent License and

H er Application for Licensure .

3. Section 648.355, Florida Statutes, authorizes the

Department to issue a temporary license to an individual as a

bail bond agent under certain conditions. Those conditions

include the requirements, among others, that the applicant

complete basic certification courses within four years prior to

the date an application is filed and that the applicant "be

employed full time at the time of licensure, and at all times

throughout the existence of the temporary license, by only o ne

licensed and appointed supervising bail bond agent, who

supervises the work of the applicant and is responsible for the

licensee's conduct in the bail bond business. . . ."

§ 648.355(1)(d) and (e), Fla. Stat.

4. On August 24, 2001, Ms. Schubert was is sued a

certificate by Florida Bail Bond School, Inc., for successfully

completing courses in criminal justice for bail bond agents

required as a prerequisite to applying for a temporary bail bond

agent license. 2 (Stipulated fact).

5. On October 30, 2001, Ms. Schubert was issued a

certificate by the University of Florida, Division of Continuing

Education, certifying her completion of the requirements of

"INS 3 - Bail Bond Agent Qual Crse - Self Study." 3 (Stipulated

fact).

6. On or about December 12, 2001 , the Department received

an application from Ms. Schubert seeking licensure as a

temporary bail bond agent (hereinafter referred to as a

"temporary license") pursuant to Section 648.355, Florida

Statutes. Ms. Schubert designated Jenny Garcia, Florida Lic ense

number A03131, Manager of Estrella Bail Bonds, on the

application as her supervising bail bond agent. (Stipulated

fact).

7. After review of Ms. Schubert's application, the

Department concluded that she met the requirements of Section

648.355, Florid a Statutes, and on or about April 22, 2002,

issued her a temporary license, license number E023179.

(Stipulated fact).

8. Ms. Schubert was employed by Estrella Bail Bonds and

was under the supervision of Ms. Garcia upon the issuance of her

temporary lice nse. Between July 2002 and December 2002,

Ms. Schubert completed her temporary license internship hours of

employment with Estrella Bail Bonds. (Stipulated fact).

9. In October 2002, in anticipation of completing her

internship, Ms. Schubert filed an ap plication for the bail bond

agent license at issue in this proceeding.

10. By letter dated April 18, 2003, the Department denied

Ms. Schubert's license application based upon the following

alleged facts:

You, Sara K. Schubert, have acted in the

capacity o f, and held yourself out as bail

bond agent without being properly licensed

and appointed, in violation of the Florida

Insurance Code. You have established a

place of business, designated by you as "A

Bunny Bail Bonds Agency," which is not under

the activ e full - time charge of a licensed

and appointed bail bond agent; you have

provided, or had provided on your behalf,

internet advertising and business cards

which identify you as the agent/owner of "A

Bunny Bail Bonds Agency" and advertise the

services of th at agency; you have entered

into a lease agreement for office space for

"A Bunny Bail Bonds Agency," representing

yourself as the President of that agency;

you have provided for the advertising of the

services of "A Bunny Bail Bonds Agency" at

the leased l ocation; you have acquired and

maintained telephone services for "A Bunny

Bail Bonds Agency," and have advertised the

availability of the bond agency's services

through the availability of that telephone

service. You are operating a bail bond

agency separ ate from your supervising

agent's business address.

C. Ms. Schubert's Business Planning and General

Activities .

11. As early as the beginning of 2001, Ms. Schubert

decided that she wanted to become licensed as a bail bond agent

and began planning accor dingly.

12. In addition to taking the steps required by the

Department to obtain licensure as a bail bond agency, including

obtaining a temporary license, Ms. Schubert began taking certain

actions to ensure that she could begin to operate her bail bond

ag ency immediately upon being licensed as a bail bond agent.

13. The steps which Ms. Schubert took to prepare her

business included the naming of her business, the creation of a

corporate entity, logo, and business slogan, obtaining local and

toll - free tele phone numbers for the business, having a business

plan prepared, having an internet web - page readied, executing a

lease for office space, arranging for a yellow - pages

advertisement, and obtaining advertising materials, including

business cards, key chains, pens, and stickers. In addition to

planning for her future business, Ms. Schubert also actually

advertised her future business.

14. The evidence failed to prove that Ms. Schubert or

anyone on her behalf was actually "appointed by an insurer by

power of attorney to execute or countersign bail bonds in

connection with judicial proceedings who receives or is promised

money or other things of value therefor" or that that she

"pledge[d] United States currency, United States postal money

orders, or cashier's c hecks as security for a bail bond in

connection with a judicial proceeding and receive[d] or [was]

promised therefor money or other things of value."

15. The evidence also failed to prove that Ms. Schubert,

based upon the facts alleged by the Department i n support of its

denial of her license application, is incompetent,

untrustworthy, unfit as to character and background or lacking

in one or more of the required qualifications for license or

appointment, or has demonstrated a course of conduct or practice

which indicate that she is incompetent, negligent, or dishonest.

16. The following is a summary of the timing of the events

pertinent to this matter, each of which is discussed in further

detail, infra .:

2001

a. April: Future business is named.

A Bunn y Bail Bonds, Inc. formed.

b. Aug. to Oct.: Courses required for temporary license

taken.

c. December: Application for temporary license filed.

2002

a. March: 1 year lease for office space executed.

b. April: Temporary bail bond agent license iss ued.

c. Spring: Business cards, stickers, pens, and other

advertisements purchased.

Internet web page created.

Sign placed on door of office, mail box,

and office - building information board.

d. July to Dec.: Internship for Estrella Bail Bonds.

e. October: Ms. Schubert filed application for

licensure.

f. November: Telephone service contract entered into.

Department investigation begun.

2003

a. February: Telephone approval to arrange for yellow -

pages advertisement obtained from

D epartment.

b. April: Business plan prepared.

Department denied license application.

c. May: Department's investigation closed with

letter of guidance.

D. Naming and Incorporating the Future Business .

17. In April 2001, at least eight months prio r to filing

her application for temporary license with the Department,

Ms. Schubert decided that she would call her bail bond agency "A

Bunny Bail Bonds."

18. Toward that end, on April 16, 2001, Ms. Schubert filed

documents with the Department of State cr eating a corporate

entity named "A Bunny Bail Bonds Agency, Inc."

19. The Articles of Incorporation for the corporation,

which were signed by Ms. Schubert on or about April 10, 2001,

designated Ms. Schubert as the president of, and the registered

agent fo r, the corporation. The Articles of Incorporation do

not describe the nature of the business to be conducted by the

corporation.

E. Telephone Services for A Bunny Bail Bonds .

20. At roughly the same time that Ms. Schubert decided on

the name of her busi ness in April 2001, Ms. Schubert contacted

AT&T to inquire about obtaining a toll - free number for A Bunny

Bail Bonds. Ms. Schubert selected and reserved "866 The - Buny"

(843 - 2869) as the toll - free number for A Bunny Bail Bonds. The

evidence failed to prov e, however, that any calls were actually

made to this number. The evidence also failed to prove whose

name the toll - free service was contracted under.

21. Effective November 1, 2002, just over six months after

receiving her temporary license and two mont hs before she

completed her required internship with Estrella Bail Bonds,

Ms. Schubert opened an account for telephone services for A

Bunny Bail Bonds. The account was opened with BellSouth

Telecommunications, the local telephone provider for Fort

Lauderd ale.

22. Ms. Schubert contracted for basic service for three

separate phone lines at a monthly charge of $27.75: telephone

numbers (954) 462 - 1600; 462 - 5800; and 469 - 1300. Ms. Schubert

also selected three optional services for A Bunny Bail Bonds:

the "C omplete Choice for Business Messaging Package," the

"Complete Choice for Business Maintenance 3 Line Package," and

the "Complete Choice for Business 3 Line Package." 4

23. Ms. Schubert committed to pay $164.00 a month for the

optional services she agreed t o. 5

F. Office Space Rental .

24. On or bout March 13, 2002, almost a month before

Ms. Schubert was issued her temporary license, Ms. Schubert

entered into a one - year lease agreement for a 350 square - foot

office (hereinafter referred to as the "Office"), i dentified as

"suite 3" and located at 521 South Andrews Avenue, Fort

Lauderdale, Broward County, Florida. (Stipulated fact).

25. The Office is conveniently located across the street

from the Broward County courthouse.

26. The lease agreement identifies "A Bunny Bail Bonds

Agency, Inc., Sara Schubert, President" as the Lessee of the

Office and was entered into by Ms. Schubert as "President" of A

Bunny Bail Bonds Agency, Inc. (Stipulated fact).

27. The one - year lease period commenced April 1, 2002, the

m onth Ms. Schubert received her temporary license. She made a

security deposit in the amount of $873.50 and has paid a monthly

rental fee of $463.75 for the Office. (Stipulated fact).

28. The evidence failed to prove that the Office was

actually used to carry out any bail bond business. 6

29. The mailbox for the Office was located with other

mailboxes for the building at a central location. To ensure

that she received mail addressed to the Office, Ms. Schubert

placed a small yellow - sticky on the box whic h had "#3,

S. Schubert, A Bunny Bail Bonds" hand - written on it.

G. Web - Page for A Bunny Bail Bonds .

30. Ms. Schubert arranged to have an internet web page

created for A Bunny Bond Bonds. The web page identifies

Ms. Schubert as "Agent/Owner" of A Bunny B ail Bonds, identifies

the business address as 521 South Andrew Street, Suite 3, Fort

Lauderdale, Florida 33001 (the address for the Office), and

lists three telephone numbers: the toll - free telephone number

she had reserved with AT&T; (305) 606 - 9662 a Dad e County

telephone number; and (954) 439 - 2211, a Broward County telephone

number. The Broward County telephone number is listed as

Ms. Schubert's home telephone number on Respondent's Exhibits 13

through 15.

31. The web page represents that A Bunny Bail Bonds

accepts all major credit cards.

32. The A Bunny Bail Bonds web page was accessible in

December 2002 and it is inferred, because of the telephone

numbers listed on the web page, that the web page was developed

after March 2002 (when the lease was ent ered into) and before

November 2002 (when local telephone services were contracted

for).

33. The web page was not registered with any internet

search engine and, therefore, could only be accessed if the web

address was known. The web - address was, however , included on

the business cards Ms. Schubert purchased. The evidence failed

to prove whether anyone other than someone at the Department

ever accessed the web page.

H. Yellow - Page Advertisement .

34. Ms. Schubert had applied for licensure in October 200 2

and, therefore, she began planning to place an advertisement in

the newest addition of the telephone book yellow pages for 2003,

when she anticipated that she would be able to open her

business.

35. Because of concern over whether she would receive her

license before the deadline for taking out a yellow - pages

advertisement expired, she arranged for James Moore, a friend

and licensed bail bond agent, to contact the Department about

going forward with the advertisement in anticipation of the

approval of he r license. (Stipulated fact). Despite the fact

that Ms. Schubert had not received her license and had in fact

been the subject of an investigation by the Department, the

Department, through its agents, approved the placement of the

yellow pages advertise ment by Ms. Schubert.

36. In reliance upon the Department's approval,

Ms. Schubert paid $28,000.00 for a half - page yellow - pages

advertisement for A Bunny Bail Bonds. The advertisement

included the corporate name, a picture of Ms. Schubert with her

name a nd "C.E.O." under it, the web page address, the toll - free

telephone number, telephone number (954) 462 - 1600, the address

of the Office, and the logos for several credit cards.

J. Business Cards, Stickers, Pens, and Key Chains .

37. In anticipation of beco ming licensed as a bail bond

agent, Ms. Schubert purchased business cards, stickers, ink

pens, and key chains to be used in advertising A Bunny Bail

Bond.

38. The business cards, which were purple, included the

name of the corporation, a logo which consis ts of a rabbit with

a key in its paw standing behind a rabbit dressed in striped -

prison garb (hereinafter referred to as the "Logo"),

Ms. Schubert's name as "Agent/Owner," a business slogan, "We'll

get your tail out of jail" (hereinafter referred to as the

"Slogan"), the address of the Office, the toll - free telephone

number listed as the "Office" number, telephone number (954)

439 - 2211, Ms. Shubert's home telephone number, as a "Mobile"

number, and the internet web page address. 7

39. The stickers included the name of the corporation, the

Logo, and two telephone numbers: the toll - free number and (954)

439 - 2211, Ms. Schubert's home telephone number. 8

40. The pens purchased by Ms. Schubert include the name of

the corporation, the Logo, and two telephone numb ers: the toll -

free number and (954) 439 - 2211, Ms. Schubert's home telephone

number. 9

41. The business cards described in Finding of Fact 38,

the stickers, and the pens were purchased sometime after

Ms. Schubert leased the Office in March 2002 and before she

contracted for local telephone services for the office in

November 2002.

42. A later version of business cards was purchased by

Ms. Schubert in late 2002 or early 2003. 10 The later version of

the business card changed the telephone numbers listed on t he

card to (954) 462 - 1600 as the "Office" number, 1 - 866 - The - Buny as

a "Toll Free" number, and (305) 366 - 5532 as a "Pager" number.

These cards were purchased after November 2002 when Ms. Schubert

contracted for local telephone services.

43. Ms. Schubert a lso purchased key chains which include

the name of the name of the corporation, the logo, the toll - free

number, and telephone number (954) 462 - 1600. 11 The key chains

were, therefore, purchased after November 2002 when Ms. Schubert

contracted for local tele phone services.

K. Good Business Planning vs. Public Harm .

44. Most of Ms. Schubert's actions described in this

Recommended Order constituted good business planning. Those

activities, to the extent there was no public disclosure, also

were of little if any potential harm to the public: creating a

corporation, selecting the name of a future business,

contracting for the office and telephone services, creating a

web page not generally accessible to the public, obtaining a

business plan, and purchasing adv ertising materials (business

cards, key chains, pens, and stickers). The number of

individuals involved with those transactions and who, therefore,

were aware of Ms. Schubert's activities, were too insignificant

to constitute any potential harm to the pub lic.

45. Ms. Schubert, however, went beyond good business

planning when she began to disclose the existence of her company

to the public before she obtained her license:

a. In November 2002, if not earlier, a piece of wood

shaped like a rabbit and one of the stickers purchased by

Ms. Schubert were placed on the door of the Office, which was

located in a building where person seeking the services of bail

bond agencies often visited 12 ;

b. Ms. Schubert replaced the rabbit on her door with a

crow. She placed several of her business cards on top of the

crow. The cards were, therefore, available to anyone who passed

by the Office 13 ;

c. Ms. Schubert had a sign on the door of her automobile

with A Bunny Bail Bonds written on it;

d. Ms. Schubert placed a number of her cards, pens, and

key chains on the door of a bail bond agency located in the same

building the Office was located in. The bail bond agency was

Dolphin Bail Bonds, which was owned by Ronald Blum 14 ; and

e. Ms. Schubert sent a Christmas present to her former

employer in an envelope with "Bunny Bail" and the address of the

Office as the return address.

L. The Department's Investigation of Ms. Schubert .

46. During the fall of 2002, the Department received a

complaint from Mr. Blum of Dolphin Bail Bonds , suggesting that

Ms. Schubert was operating A Bunny Bail Bonds.

47. On or about November 25, 2002, as a result of Mr.

Blum's complaint, Patricia Anthony, an investigator for the

Department, sent a letter to Ms. Schubert informing her of the

investigation . (Stipulated fact).

48. On December 5, 2002, Ms. Schubert met with Ms. Anthony

to discuss the matter. (Stipulated fact). Ms. Schubert

executed an affidavit at Ms. Anthony's request, concerning her

use of the Office. (Stipulated fact).

49. At no time after the investigation was commenced until

the investigation was completed, sometime in 2003, was the

office found to be open despite the fact that Ms. Anthony

visited the office several times. (Stipulated fact).

50. The Department's investigation of M s. Schubert was

concluded with the issuance of a letter of guidance on or about

May 29, 2003. (Stipulated Fact).

CONCLUSIONS OF LAW

A. Jurisdiction .

51. The Division of Administrative Hearings has

jurisdiction over the subject matter of this proceeding and of

the parties thereto pursuant to Sections 120.569 and 120.57(1),

Florida Statutes (2003).

B. The Burden and Standard of Proof .

52. The burden of proof, absent a statutory directive to

the contrary, is on the party asserting the affirmative of the

i ssue of the proceeding. Antel v. Department of Professional

Regulation , 522 So. 2d 1056 (Fla. 5th DCA 1988); Department of

Transportation v. J.W.C. Company, Inc. , 396 So. 2d 778 (Fla. 1st

DCA 1981); and Balino v. Department of Health and Rehabilitative

Services , 348 So. 2d 249 (Fla. 1st DCA 1977).

53. In this matter, Ms. Schubert has sought licensure as a

bail bonds agent and, therefore, has the ultimate burden of

persuasion to prove her entitlement thereto. Department of

Banking and Finance v. Osburne Stern and Co., et. al. , 670 So.

2d 932 (Fla. 1996). See also Pershing Industries, Inc. v.

Department of Banking and Finance , 591. So. 2d 991 (Fla. 1st DCA

1991). The Department's denial of Ms. Schubert's license,

however, is based upon alleged statutory violations which the

Department has asserted cause Ms. Schubert to be ineligible for

licensure. The Department, therefore, has the burden of

establishing by competent, substantial evidence that the

violations occurred. Osburne Stern at 934.

54. Once th e Department establishes that the violations

occurred, Ms. Schubert must overcome the Department's proof and

establish entitlement to licensure: "[W]hile the burden of

producing evidence may shift between the parties in an

application dispute proceeding, the burden of persuasion remains

upon the applicant to prove her entitlement to the license."

Id.

55. The standard of proof, on both Ms. Schubert and the

Department, is by the preponderance of the evidence. Id. at

934.

56. The grounds proven in support of the Department's

denial of Ms. Schubert's license application are limited to

those specifically alleged in the Department's denial letter. 15

See , e.g. , Cottrill v. Department of Insurance , 685 So. 2d 1371

(Fla. 1st DCA 1996); Kinney v. Department of St ate , 501 So. 2d

129 (Fla. 5th DCA 1987); and Hunter v. Department of

Professional Regulation , 458 So. 2d 842 (Fla. 2nd DCA 1984).

C. General Requirements for Licensure .

57. Section 648.27, Florida Statutes, generally governs

the licensure of bail bond ag ents in the State of Florida:

(1) A license may not be issued except in

compliance with this chapter, and may not be

issued except to an individual. A firm,

partnership, association, or corporation, as

such, may not be licensed.

58. Section 648.34, F lorida Statutes, establishes the more

specific requirements for licensure as a bail bond agent.

Generally, there is no dispute that Ms. Schubert is entitled to

licensure as a bail bond agent pursuant to Section 648.34,

Florida Statutes, except as otherwis e described in the

Department's denial letter.

D. The Department's Grounds for Denial .

59. Factually, the Department has suggested that the

following acts constitute individual violations of Chapter 648,

Florida Statutes, and that cumulatively, they conc lusively show

that Ms. Schubert held herself out as a bail bond agent:

a. The establishment of a place of business, designated by

Ms. Schubert as "A Bunny Bail Bonds Agency," which was not under

the active full - time charge of a licensed and appointed bail

bond agent;

b. The provision of internet advertising which identify

Ms. Schubert as the agent/owner of "A Bunny Bail Bonds Agency"

and advertise the services of that agency;

c. The provision of business cards which identify

Ms. Schubert as the agent/own er of "A Bunny Bail Bonds Agency"

and advertise the services of that agency;

d. Entering into a lease agreement for office space for "A

Bunny Bail Bonds Agency," with Ms. Schubert representing herself

as the President of that agency;

e. Providing for the advertising of the services of "A

Bunny Bail Bonds Agency" at the leased location;

f. Having acquired and maintained telephone services for

"A Bunny Bail Bonds Agency"; and

g. Having advertised the availability of the bond agency's

services through the availability of that telephone service.

60. Statutorily, the Department has cited a string of

statutory provisions, quoting parts thereof, in support of its

denial. The provisions cited by the Department include the

following:

(a) Section 648.27(2) an d (4), Florida Statutes, which

provides general guidelines for the issuance of bail bond

licenses;

(b) Section 648.34(2)(e), Florida Statutes, which

establishes qualifications for licensure;

(c) Section 648.45(2)(a), (e), (g), (j) and (p), and

(3)(c), Fl orida Statutes, which establishes the specific grounds

for denial of a license; and

(d) Sections 648.285, 648.30, 648.421, and 648.44(4),

(6)(b), and (7), Florida Statutes, which describe certain

prohibited acts.

General Guidelines for the Issuance of Lic enses; Section

648.27(2) and (4), Florida Statutes .

61. Section 648.27(2) and (4), Florida Statutes, provides

the following:

(2) For the protection of the people of

this state, the department may not

issue . . . any license or appointment

except in compliance with this chapter. The

department may not issue . . . a license or

appointment for any individual found to be

untrustworthy or incompetent who has had his

or her eligibility to hold a license or

appointment revoked, or who has not

establishe d to the satisfaction of the

department that he or she is qualified

therefor in accordance with this chapter.

. . . .

(4) If upon the basis of the completed

application for a license or appointment and

such further inquiry or investigation the

depar tment deems the applicant to be unfit

as to character and background or lacking in

one or more of the required qualifications

for the license or appointment, the

department shall disapprove the application.

. . . .

62. Given the evidence presented by the Department in this

case and the specific facts alleged by the Department in support

of its decision, it has not been shown that Ms. Schubert is

"untrustworthy or incompetent" or that she is "unfit as to

character and background or lacking in one or mor e of the

required qualifications." What the evidence proved is that

Ms. Schubert was too exuberant in her planning and that she

prematurely advertised her future business of a few, isolated,

occasions, not that she was unfit or untrustworthy.

Qualificatio ns for Licensure; Section 648.34(2)(e), Florida

Statutes .

63. Section 648.34(2)(e), Florida Statutes, provides the

following pertinent qualifications for bail bond agents:

(2) To qualify as a bail bond agent, it

must affirmatively appear at the time o f

application and throughout the period of

licensure that the applicant has complied

with the provisions of s. 648.355 and has

obtained a temporary license pursuant to

such section and:

. . . .

(e) The applicant is a person of high

character and app roved integrity and has not

been convicted or pleaded guilty or no

contest to a felony, a crime involving moral

turpitude, or a crime punishable by

imprisonment of 1 year or more under the

laws of any state, territory, or country,

whether or not a judgment or conviction has

been entered.

64. Again, the evidence in this case failed to prove that

Ms. Schubert's actions constitute the failure to comply with

Section 648.355, Florida Statutes, which sets out the

requirements for a temporary license, or that sh e is not a

person of high character and approved integrity. Ms. Schubert's

actions constituted activities consistent with preparing to

operate a bail bond business and were taken in open and plain

view.

Specific Grounds for License Denial; Section 648.45( 2)(a),

(e), (g), (j), and (p), and (3)(c), Florida Statutes .

65. The actual authority for denial of an application for

a bail bond agent license comes from Section 648.45, Florida

Statutes. It is through this provision that the Department may

exercise i ts discretion.

66. In this case, the Department has alleged that

Ms. Schubert's actions come within the following grounds of

Section 648.45, Florida Statutes, for denial of a license:

(2) The department shall deny . . . any

license or appointment issue d under this

chapter or the insurance code . . . for any

violation of the laws of this state relating

to bail or any violation of the insurance

code or if the person:

(a) Lacks one or more of the

qualifications specified in this chapter for

a license or appointment.

. . . .

(e) Has demonstrated lack of fitness or

trustworthiness to engage in the bail bond

business.

. . . .

(j) Has willfully failed to comply with

or willfully violated any proper order or

rule of the department or willfull y violated

any provision of this chapter or the

insurance code.

. . . .

(p) Has demonstrated a course of conduct

or practices which indicate that the

licensee is incompetent, negligent, or

dishonest or that property or rights of

clients cannot safel y be entrusted to him or

her.

(3) The department may deny . . . any

license or appointment issued under this

chapter or the insurance code . . . for any

violation of the laws of this state relating

to bail or any violation of the insurance

code or for any of the following causes:

. . . .

(c) Violation of any law relating to the

business of bail bond insurance or violation

of any provision of the insurance code.

. . . .

67. In its Proposed Recommended Order, the Department has

simply conclude d that all of the provisions quoted in paragraph

66 apply to Ms. Schubert. When these provisions, however, are

applied to Ms. Schubert's activities, as alleged in the amended

denial letter, it is clear that most do not apply. In

particular, the evidence failed to prove that Ms. Schubert

violated any of the alleged provisions of Section 648.45(2),

Florida Statutes, because the Department failed to prove that

she: "Lacks one or more of the qualifications specified in this

chapter for a license or appointmen t"; "Has demonstrated lack of

fitness or trustworthiness to engage in the bail bond business";

"Has willfully failed to comply with or willfully violated any

proper order or rule of the department or willfully violated any

provision of this chapter or the insurance code" 16 ; or "Has

demonstrated a course of conduct or practices which indicates

that the licensee is incompetent, negligent, or dishonest or

that property or rights of clients cannot safely be entrusted to

him or her."

68. The evidence did prove, however, that Ms. Schubert's

conduct violated Section 648.45(3)(c), Florida Statutes, by

violating several of the cited provisions of Chapter 648,

Florida Statutes, discussed, infra .

Prohibited Acts: Sections 648.285, 648.30, 648.387(1),

648.421, and 648. 44(4), (6)(b), and (7), Florida Statutes .

69. The specific "law[s] relating to the business of bail

bond insurance" which the Department has alleged Ms. Schubert

violated contrary to Section 648.45(3)(c), Florida Statutes, are

Sections 648.285, 648.30, 6 48.387, 648.421, and 648.44(4),

(6)(b), and (7), Florida Statutes.

70. Section 648.285(1), Florida Statutes, prohibits any

person from owning, controlling, or otherwise having a pecuniary

interest in a bail bond agency unless the person is licensed and

ap pointed. The evidence failed to prove that Ms. Schubert

violated this provision.

71. A "bail bond agency" is defined in Section 648.25(1),

Florida Statutes, as follows:

(1) "Bail bond agency" means:

(a) The building where a licensee

maintains an of fice and where all records

required by ss. 648.34 and 648.36 are

maintained; or

(b) Any entity that:

1. Charges a fee or premium to release an

accused defendant or detainee from jail, or

2. Engages in or employs others to engage

in any activit y that may be performed only

by a licensed and appointed bail bond agent.

72. Because the evidence failed to prove that Ms. Schubert

was actually carrying on the activities that bail bond agents

carry on, it cannot be concluded that she owned or controll ed a

"bail bond agency." All that she owned or controlled was an

office that she intended at some date in the future to operate

as a bail bond agency, but that is not specifically prohibited

by Chapter 648, Florida Statutes. Without actually conducting

b ail bond business at the office, which the Department failed to

prove Ms. Schubert did, the office was nothing more than office

space.

73. Section 648.30(1), Florida Statutes, provides the

following prohibition:

(1) A person may not act in the capacity

of a bail bond agent . . . or perform any of

the functions, duties, or powers prescribed

for bail bond agents . . . under this

chapter unless that person is qualified,

licensed, and appointed as provided in this

chapter.

74. For the reasons discussed in paragraph 81, infra , it

is concluded that Ms. Schubert violated Section 648.30(1),

Florida Statutes, by advertising A Bunny Bail Bonds, an act she

was not qualified to do.

75. Section 648.387(1), Florida Statutes, prohibits the

following:

(1) The owne r or operator of a bail bond

agency shall designate a primary bail bond

agent for each location, and shall file with

the department the name and license number

of the person and the address of the

location on a form approved by the

department. The designa tion of the primary

bail bond agent may be changed if the

department is notified immediately. Failure

to notify the department within 10 working

days after such change is grounds for

disciplinary action pursuant to s. 648.45.

76. Section 648.421, Florid a Statutes, requires the

following:

Each licensee under this chapter shall

notify in writing the department, insurer,

managing general agent, and the clerk of

each court in which the licensee is

registered within 10 working days after a

change in the licen see's principal business

address or telephone number. The licensee

shall also notify the department within 10

working days after a change of the name,

address, or telephone number of each agency

or firm for which he or she writes bonds and

any change in t he licensee's name, home

address, or telephone number.

77. The evidence failed to prove that the provisions

quoted in paragraphs 75 and 76 apply to Ms. Schubert. She was

not operating a "bail bond agency" and, therefore, she could not

violate Section 64 8.387(1), Florida Statutes. Nor did she have

any change in address or telephone number to notify the

Department of as required by Section 648.421, Florida Statutes.

78. Finally, Section 648.44, Florida Statutes, defines the

following prohibited acts:

( 4) A place of business, including a

branch office, may not be established,

opened, or maintained unless it is under the

active full - time charge of a licensed and

appointed bail bond agent.

(6)(a) . . . .

(b) Any misleading or false advertisement

o r deceptive trade practice is prohibited as

provided in part IX of chapter 626.

(7) Any permissible advertising by a bail

bond agent or agency must include the

address of record filed with the department.

79. The evidence in this case failed to prov e that

Ms. Schubert established and maintained a place of business and,

therefore, she did not violate Section 648.44(4), Florida

Statutes. All that she did was maintain office space.

80. As to Section 648.44(6)(b), Florida Statutes, the

particular prohi bited misleading or false advertisement or

deceptive trade practice prohibited by Chapter 626, Florida

Statutes, the Department has alleged Ms. Schubert violated is

Section 626.954(1)(b), Florida Statutes, which describes the

following prohibited practice:

Knowingly making, publishing, disseminating,

circulating, or placing before the public,

or causing, directly or indirectly, to be

made, published, disseminated, circulated,

or placed before the public:

1. In a newspaper, magazine, or other

publication,

2. In the form of a notice, circular,

pamphlet, letter, or poster,

3. Over any radio or television station, or

4. In any other way,

an advertisement, announcement, or statement

containing any assertion, representation, or

statement with respect to the business of

insurance, which is untrue, deceptive, or

misleading.

81. The evidence in this case proved that Ms. Schubert did

in fact place advertisements which were untrue, deceptive, or

misleading in that they suggested that A Bunny Bail Bonds was an

ap proved and operating bail bond agency. She advertised A Bunny

Bail Bonds when she placed a sticker and business cards on the

Office door and Mr. Blum's office door, she included the name of

her future business as a return address on a letter sent to her

f ormer employer, and she advertised A Bunny Bail Bonds on the

side of her automobile. All of these advertisements were

untrue, deceptive, and misleading, because they all suggested A

Bunny Bail Bonds was an operating bail bond business, which it

was not.

8 2. Finally, the advertisements Ms. Schubert used did not

include any address of record filed with the Department because

she did not yet have a "bail bond agency" for which an address

was required to be filed. She did not, therefore, violate

Section 648. 44(7), Florida Statutes.

E. Exercise of the Department's Discretion .

83. Having proved that Ms. Schubert committed a few of the

statutory violations alleged by the Department in support of its

decision to deny her license application, the Department may

exercise its discretion in this case. It should not do so,

however, unreasonably.

84. Most of the actions taken by Ms. Schubert had little,

if any, impact on the public. Creating a corporation, leasing

office space, arranging for telephone service, crea ting an

virtually inaccessible internet web site, purchasing advertising

materials, and having a business plan drafted created no harm to

the public as long as the public was not informed that these

things had taken place.

85. The only prohibited actions taken by Ms. Schubert

involved a few, isolated instances where she actually advertised

what appeared to be an existing bail bond agency: when she

placed a single sticker on the office door, when she placed her

business cards on the office door and Ms. Blu m's office door,

when she included the address on one envelope, and when she

placed a sign advertising A Bunny Bail Bonds on the side of her

car.

86. Given the lack of evidence that Ms. Schubert actually

carried on any bail bond agency business and the mi nimal public

harm she may have caused, the Department should exercise its

discretion to grant Ms. Schubert's license, with appropriate

conditions, including requiring that she take additional courses

and/or placing her on probation.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that a final order be entered by the

granting Ms. Schubert's application for licensure as a limited

surety (bail bond) agent pursuant to Chapter 648, Florida

Statutes, conditioned on her taking additional bail bond agent

training and/or placing Ms. Schubert on probation for an

appropriate period of time.

DONE AND ENTERED this 26th day of January, 2004, in

Tallahassee, Leon County, Florida.

S

___________________________________

LA RRY J. SARTIN

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.do ah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 26th day of January, 2004.

ENDNOTES

1 / Section 648.25(2), Florida Statutes, defines a "bail bond

agent" as a "limited surety agent" or a "professional bail bond

agent."

2 / It is inferred that these courses were part of the courses

required to obtain a temporary license.

3 / Id.

4 / The Department has described in greater detail the nature of

the services contracted for by Ms. Schubert in paragraph 17 of

the Departmen t's Proposed Recommended Order. The scope of

services is, however, not relevant to this proceeding.

5 / In paragraph 18 of the Department's Proposed Recommended

Order, the Department speculates as to why Ms. Schubert

contracted for the extra options. Th is paragraph is speculative

and not relevant to this matter.

6 / According to Ms. Schubert, the Office was either empty or

contained only a couch and television set. According to James

Moore, a friend of Ms. Schubert, there was also a computer in

the Off ice, and, therefore, it is inferred that there was a desk

or table upon which the computer sat. Ms. Moore's testimony in

this regard is credited.

Although Ms. Schubert was not truthful concerning the contents

of the Office, her lack of truthfulness at he aring cannot form

any basis for denying her license because the Department's

Amended Denial Letter did not include these facts as grounds for

the Department's decision. See Cottrill v. Department of

Insurance , 685 So. 2d 1371 (Fla. 1st DCA 1996).

7 / Res pondent's Exhibit 8.

8 / Respondent's Exhibit 10.

9 / Respondent's Exhibit 23.

10 / Respondent's Exhibits 8 and 22.

11 / Respondent's Exhibit 23.

12 / Ms. Schubert testified at hearing that she had placed the

sticker on the door because the mail delivery person and an

express mail carrier has suggested that she identify the office

to facilitate deliveries. While such advice is reasonable,

because she could not operate under the name A Bunny Bail Bond,

she should have conducted all of her business prior t o be

licensed solely in her own name. In that way she would not have

violated Chapter 648, Florida Statutes, by holding herself out

as a bail bond agency.

13 / Although placing the business cards on the Office door

constituted advertising, it was limited at to the likely number

of individuals who may have seen the cards.

14 / Again, although these actions constitute advertising, they

were very limited in their distribution.

15 / In its Proposed Recommended Order, the Department has

raised a number of what the Department perceives to be

inconsistencies in Ms. Schubert's testimony. At no time has the

Department proposed to deny Ms. Schubert's license application

because of any alleged lack of candor on Ms. Schubert's part.

The matters raised in the Departme nt's Proposed Recommended

Order have, therefore, only been considered in determining what

weight should be given to Ms. Schubert's testimony.

16 / Although Ms. Schubert did indeed violate certain provisions

of Chapter 648, Florida Statutes, as discussed, i nfra , the

evidence failed to prove that she did so "willfully."

COPIES FURNISHED:

Ramon de la Cabada, Esquire

Law Offices of Ramon de la Cabada, P.A.

3191 Coral Way, Suite 115

Miami, Florida 33145

Dickson E. Kesler, Esquire

Division of Legal Services

Department of Financial Services

Suite N - 321

401 Northwest Second Avenue

Miami, Florida 33128

Dana M. Wiehle, Esquire

Division of Legal Services

Department of Financial Ser vices

200 East Gaines Street

Tallahassee, Florida 32399

Honorable Tom Gallagher

Chief Financial Officer

Department of Financial Services

The Capitol, Plaza Level 11

Tallahassee, Florida 32399 - 0300

Mark Casteel, General Counsel

Department of Financia l Services

The Capitol, Plaza Level 11

Tallahassee, Florida 32399 - 0300

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 Recomme nded Order should be filed with the agency that

will issue the Final Order in this case.