04-001148PL Department Of Business And Professional Regulation, Division Of Real Estate vs. Elsa G. Cartaya Status: Closed Recommended Order on Wednesday, November 10, 2004.

Summary: Respondent, a certified real estate appraiser, committed various disciplinable offensed in connection with three residential appraisals, warranting sanctions.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case Nos. 04-1148PL

) 04-1680PL

ELSA G. CARTAYA, )

)

Respondent. )

)

RECOMMENDED ORDER

This case came before Administrative Law Judge John G.

Van Laningham for final hearing on July 29, 2004, in Miami,

Florida, and again by video teleconference on August 20, 2004,

at sites in Tallahassee and Miami, Florida

APPEARANCES

For Petitioner: Alfonso Santana, Esquire

Department of Business and

Professional Regulation

400 West Robinson Street, Suite 801N

Orlando, Florida 32801-1757

For Respondent: Jerome H. Shevin, Esquire

Levey, Airan, Brownstein, Shevin,

Friedman, Roen & Kelso, LLP

Gables One Tower, Penthouse

1320 South Dixie Highway, PH 1275

Coral Gables, Florida 33146

STATEMENT OF THE ISSUE

In this disciplinary proceeding, the issues are, first,

whether Respondent, a certified real estate appraiser, committed

various disciplinable offenses in connection with three

residential appraisals; and second, if Respondent is guilty of

any charges, whether she should be punished therefor.

PRELIMINARY STATEMENT

On August 26, 2002, the Department of Business and

Professional Regulation, as Petitioner, issued a six-count

Administrative Complaint against Respondent Elsa Cartaya, who

then timely requested an administrative hearing. On January 16,

2003, the agency issued a separate, four-count Administrative

Complaint against Ms. Cartaya, who again timely requested a

hearing. The earlier complaint alleged that Ms. Cartaya had

engaged in wrongdoing in connection with two residential

appraisals; the latter charged additional wrongdoing in

connection with yet a third appraisal. These two matters were

referred to the Division of Administrative Hearings on April 2,

2004.

On May 13, 2004, the agency's motion to consolidate the

cases was granted. The consolidated cases proceeded together to

final hearing on July 29, 2004, and again on August 20, 2004.

The agency called the following witnesses: Tibizay

Morales; David B.C. Yeomans, Jr.; Marisel Ross; Mark A. Cannon;

and Rocky Hubert. Petitioner's Exhibits numbered 1, 2, 4, 5, 9,

and 18-20 were received into evidence. Ms. Cartaya testified on

her own behalf and called no other witnesses. Respondent's

Exhibits 1-6 were admitted into evidence.

The final hearing transcript, comprising four volumes, was

filed on October 4, 2004. Petitioner timely filed a Proposed

Recommended Order before the original established deadline,

which was October 25, 2004. At the request of Ms. Cartaya's

counsel, that deadline was extended to October 29, 2004. Even

still, Respondent's Proposed Recommended Order was filed late,

on November 1, 2004. The parties' post-hearing submissions were

considered.

Petitioner's Motion to Bar Respondent From Filing a

Proposed Recommended Order, After October 29, 2004, which was

filed on November 1, 2004, is denied.

Unless otherwise indicated, citations to the Florida

Statutes refer to the 2003 Florida Statutes.

FINDINGS OF FACT

1. The Florida Real Estate Appraisal Board ("Board") is

the state agency charged with regulating real estate appraisers

who are, or want to become, licensed to render appraisal

services in the State of Florida. The Department of Business

and Professional Regulation ("Department") is the state agency

responsible for investigating and prosecuting complaints against

such appraisers.

2. At all times relevant to this proceeding, Elsa Cartaya

("Cartaya") was a Florida-certified residential real estate

appraiser. Her conduct as an appraiser in connection with the

matters presently at issue falls squarely within the Board's

regulatory jurisdiction.

Case No. 04-1680

3. In the Administrative Complaint that initiated DOAH

Case No. 04-1680, the Department charged Cartaya with numerous

statutory violations relating to her appraisal of a residence

located at 930 East Ninth Place, Hialeah, Florida (the "Hialeah

Property").

4. Specifically, the Department made the following

allegations against Cartaya: 1

5. Respondent developed and communicated an

appraisal report (Report) for the property

commonly known as 930 E. 9 Place, Hialeah,

Florida 33010. A copy of the report is

attached hereto and incorporated herein as

Administrative Complaint Exhibit 1.

6. On the Report, Respondent represents

that:

a. she signed it on July 27, 2000,

b. the Report is effective as of July 27,

2000.

7. On or about October 26, 2001, Respondent

provided a "Report History" to Petitioner's

investigator. A copy of the report history

is attached hereto and incorporated herein

as Administrative Complaint Exhibit 2.

8. On the Report History, Respondent admits

that she completed the report on August 7,

2000.

9. On Report, Respondent represents that

there were no prior sales of subject

property within one year of the appraisal.

10. Respondent knew that a purchase and

sale transaction on subject property closed

on July 28, 2000.

11. Respondent knew that the July 28, 2000,

transaction had a contract sales price of

$82,000. A copy of the closing statement is

attached hereto as Administrative Complaint

Exhibit 3.

12. Respondent knowingly refused to

disclose the July 28, 2000, sale on Report.

13. On [the] Report, Respondent represented

that the current owner of subject property

was Hornedo Lopez.

14. Hornedo Lopez did not become the title-

owner until on or about July 28, 2000, but

before August 7, 2000.

15. On [the] Report, Respondent represents

that quality of construction of subject

property is "CBS/AVG."

16. The public records reflect that subject

property is of mixed construction, CBS and

poured concrete.

17. On [the] Report, Respondent represents:

"The income approach was not derived due to

lack of accurately verifiable data for the

mostly owner occupied area."

18. The multiple listing brochures indicate

as follows:

a. for comparable one: "Main House 3/2 one

apartment 1/1 (Rents $425) and 2

efficiencies each at $325. Live rent free

with great income or bring your big family."

A copy of the brochure for comparable one is

attached hereto and incorporated herein as

Administrative Complaint Exhibit 4.

b. for comparable three: "Great Rental

. . . two 2/1 two 1/1 and one studio. Total

rental income is $2,225/month if all

rented." A copy of the brochure for

comparable three is attached and

incorporated as Administrative Complaint

Exhibit 5.

19. On or about October 23, 2001,

Petitioner's investigator inspected

Respondent's work file for Report.

20. The investigation revealed that

Respondent failed to maintain a true copy of

Report in the work file.

21. On [the] Report, Respondent failed to

analyze the difference between comparable

one's listing price, $145,000, and the sale

price, $180.000.

22. On [the] Report History, Respondent

admits to having received a request for

appraisal of subject property indicting a

contract price of $195,000.

23. On [the] Report History, Respondent

admits that the multiple listing brochure

for subject property listed the property for

$119,900, as a FANNIE MAE foreclosure.

24. On [the] Report History, Respondent

also admits that she had a multiple listing

brochure in the file, listing subject

property for $92,000.

25. On [the] Report History, Respondent

admits that she did not report the listings

in Report.

26. On [the] Report History, Respondent

admits knowledge that comparable three was

"rebuilt as a 2/1 with two 1/1 & 1 studio

receiving income although zoned

residential."

27. On [the] Report, Respondent failed or

refused to explain or adjust for comparable

three's zoning violations.

5. On the foregoing allegations, the Department charged

Cartaya under four counts, as follows:

COUNT I

Based upon the foregoing, Respondent is

guilty of fraud, misrepresentation,

concealment, false promises, false

pretenses, dishonest conduct, culpable

negligence, or breach of trust in any

business transaction in violation of Section

475.624(2), Florida Statutes.[ 2 ]

COUNT II

Based upon the foregoing, Respondent is

guilty of having failed to use reasonable

diligence in developing an appraisal report

in violation of Section 475.624(15), Florida

Statutes.

COUNT III

Based upon the foregoing, Respondent has

violated a standard for the development or

communication of a real estate appraisal or

other provision of the Uniform Standards of

Professional Appraisal Practice in violation

of Section 475.624(14), Florida Statutes.

COUNT IV

Based upon the foregoing, Respondent is

guilty of having accepted an appraisal

assignment if the employment itself is

contingent upon the appraiser reporting a

predetermined result, analysis, or opinion,

or if the fee to be paid for the performance

of the appraisal assignment is contingent

upon the opinion, conclusion, or valuation

reached upon the consequent resulting from

the appraisal assignment in violation of

Section 475.624(17), Florida Statutes.[ 3 ]

6. In her Answer and Affirmative Defenses, Cartaya

admitted the allegations set forth in paragraphs 5-9, 11, 13-15,

17-19, and 23-25 of the Amended Complaint. Based on Cartaya's

admissions, the undersigned finds these undisputed allegations

to be true. Additional findings are necessary, however, to make

sense of these particular admissions and to determine whether

Cartaya committed the offenses of which she stands accused.

7. In April 2000, Southeast Financial Corporation

("Southeast") asked Cartaya to prepare an appraisal of the

Hialeah Property for Southeast's use in underwriting a mortgage

loan, the proceeds of which would be applied by the prospective

mortgagor(s) towards the $205,000 purchase price that

he/she/they had agreed to pay Hornedo Lopez ("Hornedo") for the

residence in question. 4

8. In preparing the appraisal, Cartaya discovered that the

putative seller, Hornedo, was actually not the record owner of

the Hialeah Property. Rather, title was held in the name of the

Federal National Mortgage Association ("Fannie Mae"). The

Hialeah Property was "in foreclosure."

9. Cartaya informed her contact at Southeast, Marianella

Lopez ("Marianella"), about this problem. Marianella explained

that Hornedo was in the process of closing a sale with Fannie

Mae and would resell the Hialeah Property to a new buyer soon

after acquiring the deed thereto. Cartaya told Marianella that,

to complete the appraisal, she (Cartaya) would need to be

provided a copy of the closing statement documenting the

transfer of title from Fannie Mae to Hornedo.

10. No further work was done on the appraisal for several

months. Then, on July 25, 2000, Marianella ordered another

appraisal of the Hialeah Property, this time for Southeast's use

in evaluating a mortgage loan to Jose Granados ("Granados"), who

was under contract to purchase the subject residence from

Hornedo for $195,000.

11. Once again, Cartaya quickly discovered that Fannie

Mae, not Hornedo, was the record owner of the Hialeah Property.

Once again, Cartaya immediately informed Marianella about the

situation. Marianella responded on July 26, 2000, telling

Cartaya that the Fannie Mae-Hornedo transaction was scheduled to

close on July 28, 2000.

12. On July 27, 2000, Marianella faxed to Cartaya a copy

of the Settlement Statement that had been prepared for the

Fannie Mae sale to Hornedo. The Settlement Statement, which

confirmed that the intended closing date was indeed July 28,

2000, showed that Hornedo was under contract to pay $82,000 for

the Hialeah Property——the property which he would then sell to

Granados for $195,000, if all the pending transactions closed as

planned.

13. Upon receipt of this Settlement Statement, Cartaya

proceeded to complete the appraisal. In the resulting Appraisal

Report, which was finished on August 7, 2000, 5 Cartaya estimated

that the market value of the Hialeah Property, as of July 27,

2000, was $195,000.

14. The Department failed to prove by clear and convincing

evidence that the house at the Hialeah Property was, in fact,

constructed from CBS and poured concrete, as alleged. 6

15. At the time Cartaya gave the Department a copy of her

workfile for this appraisal assignment, the workfile did not

contain a copy of the competed Appraisal Report. 7 (The workfile

did, however, include a working draft of the Appraisal Report.)

16. The allegation, set forth in paragraph 21 of the

Administrative Complaint, that Cartaya "failed to analyze the

difference between comparable one's listing price, $145,000, and

the sale price, $180,000," was not proved by clear and

convincing evidence. First, there is no nonhearsay evidence in

the record that "comparable one" was, in fact, listed at

$145,000 and subsequently sold for $180,000. Instead, the

Department offered a printout of data from the Multiple Listing

Service ("MLS"), which printout was included in Cartaya's

workfile. The MLS document shows a listing price of $145,550

for "comparable one" and a sales price of $180,000 for the

property——but it is clearly hearsay as proof of these matters, 8

and no predicate was laid for the introduction of such hearsay

pursuant to a recognized exception to the hearsay rule

(including Section 475.28(2)). Further, the MLS data do not

supplement or explain other nonhearsay evidence. 9 At best, the

MLS document, which is dated July 25, 2000, establishes that

Cartaya was on notice that "comparable one" might have sold for

more than the asking price, but Cartaya has not been charged

with overlooking MLS data.

17. Second, in any event, in her Report History, Cartaya

stated that she had analyzed the putative asking price/sales

price differential with respect to "comparable one" and

concluded that there was no need to make adjustments for this

because available data relating to other sales persuaded her

that such differentials were typical in the relevant market.

Cartaya's declaration in this regard was not persuasively

rebutted.

18. Since the evidence fails persuasively to establish

that Cartaya's conclusion concerning the immateriality of the

putative asking price/sales price differential as a factor

bearing on the value of "comparable one" was wrong; and,

further, because the record lacks clear and convincing evidence

that an appraiser must, in her appraisal report, not only

disclose such information, even when deemed irrelevant to the

appraisal, but also expound upon the grounds for rejecting the

data as irrelevant, Cartaya cannot be faulted for declining to

explicate her analysis of the supposed price differential in the

Appraisal Report.

19. The evidence is insufficient to prove, clearly and

convincingly, that Cartaya "failed or refused to explain or

adjust for "comparable three"'s zoning violations." This

allegation depends upon the validity of its embedded assumption

that there were, in fact, "zoning violations." 10 There is,

however, no convincing evidence of such violations in the

instant record. Specifically, no copy of any zoning code was

offered as evidence, nor was any convincing nonhearsay proof

regarding the factual condition of "comparable three" offered.

Cartaya cannot be found guilty of failing or refusing to explain

or adjust for an underlying condition (here, alleged "zoning

violations") absent convincing proof of the underlying

condition's existence-in-fact.

Case No. 04-1148

20. In the Administrative Complaint that initiated DOAH

Case No. 04-1148, the Department charged Cartaya with numerous

statutory violations relating to her appraisals of residences

located at 1729 Northwest 18th Street, Miami, Florida ("1729 NW

18th St") and 18032 Northwest 48th Place, Miami, Florida ("18032

NW 48th Place"). These appraisals will be examined in turn.

21. With regard to 1729 NW 18th St, the Department alleged

as follows:

4. On or about April 29, 1999, Respondent

developed and communicated a Uniform

Residential Appraisal Report for the

property commonly known as 1729 NW 18th

Street, Miami, Florida. A copy of the

report is attached hereto and incorporated

herein as Administrative Complaint Exhibit

1.

5. On or about March 18, 2001, David B. C.

Yeomans, Jr., A.S.A., and Mark A. Cannon,

A.S.A., performed a field review of the

report. A copy of the review is attached

hereto and incorporated herein as

Administrative Complaint Exhibit 2.

6. The review revealed that unlike it

states in the Report, the subject property’s

zoning was not "Legal," but "legal

noncomforming (Grandfathered use)."

7. The review further revealed that

Respondent failed to report that if the

improvements sustain extensive damage or

demolishment or require renovation which

exceeds 50% of the depreciated value, it is

likely that a variance would be necessary to

build a new dwelling.

8. The review further revealed that

Respondent failed to report that subject

property has two underground gas meters.

9. The review further revealed that unlike

Respondent states in Report, subject

property’s street has gutters and storm

sewers along it.

10. The review further revealed that

subject property is a part of a "sub-market"

within its own neighborhood due to its

construction date of 1925.

11. Respondent applied three comparables

built in 1951, 1953, and 1948, respectively,

all of which reflect a different market,

without adjustment.

12. Respondent applied comparables which

have much larger lots than the subject,

which is of a non-conforming, grandfathered

use.

13. Respondent failed to adjust for quality

of construction even though subject is frame

and all three comparables are of concrete

block stucco construction.

14. Respondent failed to note on the Report

that comparables 1 and 2 had river frontage.

15. Respondent failed to adjust comparables

1 and 2 for river frontage.

16. The review revealed that at the time of

the Report there were at least five sales

more closely comparable to Subject than

those which Respondent applied.

22. On the foregoing allegations, the Department brought

the following three counts against Cartaya:

COUNT I

Based upon the foregoing, Respondent is

guilty of having failed to use reasonable

diligence in developing an appraisal report

in violation of Section 475.624(15), Florida

Statutes.

COUNT II

Based upon the foregoing, Respondent has

violated a standard for the development or

communication of a real estate appraisal or

other provision of the Uniform Standards of

Professional Appraisal Practice in violation

of Section 475.624(14), Florida Statutes.

COUNT III

Based upon the foregoing, Respondent is

guilty of culpable negligence in a business

transaction in violation of Section

475.624(2), Florida Statutes.

23. Cartaya admitted the allegations set forth in

paragraph 4 of the Administrative Complaint. Those undisputed

allegations, accordingly, are accepted as true.

24. The rest of the allegations about this property were

based upon a Residential Appraisal Field Review Report (the

"Yeomans Report") that David B.C. Yeomans, Jr. prepared in March

2001 for his client Fannie Mae. The Yeomans Report is in

evidence as Petitioner's Exhibit 2, and Mr. Yeomans testified at

hearing.

25. Mr. Yeomans disagreed with Cartaya's opinion of value

regarding 1729 NW 18th St, concluding that the property's market

value as of April 29, 1999, had been at the low end of the

$95,000-to-$115,000 range, and not $135,000 as Cartaya had

opined. The fact-findings that follow are organized according

to the numbered paragraphs of the Administrative Complaint.

26. Paragraphs 6 and 7. The form that Cartaya used for

her Appraisal Report regarding 1729 NW 18th St contains the

following line:

Zoning compliance Legal Legal

nonconforming (Grandfathered use) Illegal

No zoning

Cartaya checked the "legal" box. Mr. Yeomans maintains that she

should have checked the box for "legal nonconforming" use

because, he argues, the property's frontage and lot size are

smaller than the minimums for these values as prescribed in the

City of Miami's zoning code.

27. The Department failed, however, to prove that Cartaya

checked the wrong zoning compliance box. There is no convincing

nonhearsay evidence regarding either the frontage or the lot

size of 1729 NW 18th St. 11 Thus, there are no facts against

which to apply the allegedly applicable zoning code provisions.

Moreover, and more important, the Department failed to introduce

into evidence any provisions of Miami's zoning code. Instead,

the Department elicited testimony from Mr. Yeomans regarding his

understanding of the contents of the zoning code. While Mr.

Yeomans' testimony about the contents of the zoning code is

technically not hearsay (because the out-of-court statements,

namely the purported code provisions, consisted of non-assertive

declarations 12 that were not offered for the "truth" of the

code's provisions 13 ), such testimony is nevertheless not clear

and convincing evidence of the zoning code's terms. 14

28. And finally, in any event, Cartaya's alleged "mistake"

(which allegation was not proved) was immaterial because, as Mr.

Yeomans conceded at hearing, in testimony the undersigned

credits as true, the alleged "fact" (again, not proved) that

1729 NW 18th St constituted a grandfathered use would have no

effect on the property's market value.

29. Paragraphs 8 and 9. The Yeomans Report asserts that

"[b]ased on a physical inspection as of March 17, 2001[,] it

appears that the site has two underground gas meters and there

were gutters and storm sewers along the subject's street." It

is undisputed that Cartaya's Appraisal Report made no mention of

underground gas meters or storm water disposal systems. While

the Department alleged that Cartaya's silence regarding these

matters constituted disciplinable "failures," it offered no

convincing proof that Cartaya defaulted on her obligations in

any way respecting these items. There was no convincing

evidence that these matters were material, affected the

property's value, or should have been noted pursuant to some

cognizable standard of care.

30. Paragraphs 10 and 11. The contention here is that

Cartaya chose as comparables several homes that, though

relatively old (average age: 48 years), were not as old as the

residence at 1729 NW 18th St (74 years). Mr. Yeomans asserted

that older homes should have been used as comparables, and

several such homes are identified in the Yeomans Report.

31. The undersigned is persuaded that Mr. Yeomans' opinion

of value with respect to 1729 NW 18th St is probably more

accurate than Cartaya's. If this were a case where the value of

1729 NW 18th St were at issue, e.g. a taking under eminent

domain, then Mr. Yeomans' opinion might well be credited as

against Cartaya's opinion in making the ultimate factual

determination. The issue in this case is not the value of 1729

NW 18th St, however, but whether Cartaya committed disciplinable

offenses in appraising the property. The fact that two

appraisers have different opinions regarding the market value of

a property does not mean that one of them engaged in misconduct

in forming his or her opinion. Based on the evidence presented,

the undersigned is not convinced that Cartaya engaged in

wrongdoing in connection with her appraisal of 1729 NW 18th St,

even if her analysis appears to be somewhat less sophisticated

than Mr. Yeomans'.

32. Paragraphs 12 through 16. The allegations in these

paragraphs constitute variations on the theme just addressed,

namely that, for one reason or another, Cartaya chose

inappropriate comparables. For the same reasons given in the

preceding discussion, the undersigned is not convinced, based on

the evidence presented, that Cartaya engaged in wrongdoing in

connection with her appraisal of 1729 NW 18th St, even if he is

inclined to agree that Mr. Yeomans' opinion of value is the

better founded of the two.

33. With regard to 18032 NW 48th Place, the Department

alleged as follows:

18. On or about August 9, 1999, Respondent

prepared and communicated a Uniform

Residential Appraisal Report for the

Property commonly known as 18032 NW 48th

Place, Miami, Florida, 33055. (Report) A

copy of the Report is attached hereto and

incorporated herein as Administrative

Complaint Exhibit 3.

19. On the Report, Respondent incorrectly

stated that the property is in a FEMA Zone X

flood area. In fact, the property is in an

AE Zone.

20. In Report, Respondent states: "Above

sales were approximately adjusted per market

derived value influencing dissimilarities as

noted."

21. Respondent failed to state in Report,

that comparables 1 and 3 have in-law

quarters.

22. In [the] Report, Respondent represented

comparable 1 had one bath, where in fact it

has at least two.

23. In [the] Report, Respondent failed to

state that comparable 1 has two in-law

quarters.

24. In [the] Report, Respondent stated that

comparable 3 is a two-bath house with an

additional bath in the in-law quarters.

34. On the foregoing allegations, the Department brought

the following three counts against Cartaya:

COUNT IV

Based upon the foregoing, Respondent has

violated a standard for the development or

communication of a real estate appraisal or

other provision of the Uniform Standards of

Professional Appraisal Practice in violation

of Section 475.624(14), Florida Statutes.

COUNT V

Based upon the foregoing, Respondent is

guilty of having failed to use reasonable

diligence in developing an appraisal report

in violation of Section 475.624(15), Florida

Statutes.

COUNT VI

Based upon the foregoing, Respondent is

guilty of culpable negligence in a business

transaction in violation of Section

475.624(2), Florida Statutes.

35. Cartaya admitted the allegations set forth in

paragraphs 18 and 20 of the Administrative Complaint. Those

undisputed allegations, accordingly, are accepted as true.

36. The rest of the allegations about this property were

based upon a Residential Appraisal Field Review Report (the

"Marmin Report") that Frank L. Marmin prepared in May 2001 for

his client Fannie Mae. The Marmin Report is in evidence as

Petitioner's Exhibit 5. Mr. Marmin did not testify at hearing,

although his supervisor, Mark A. Cannon, did.

37. Mr. Marmin disagreed with Cartaya's opinion of value

regarding 18032 NW 48th Place, concluding that the property's

market value as of August 9, 1999, had been $100,000, and not

$128,000 as Cartaya had opined. The fact-findings that follow

are organized according to the numbered paragraphs of the

Administrative Complaint.

38. Paragraph 19. Cartaya admitted that she erred in

noting that the property is located in FEMA Flood Zone "X," when

in fact (she agrees) the property is in FEMA Flood Zone "AE."

She did, however, include a flood zone map with her appraisal

that showed the correct flood zone designation. Cartaya's

mistake was obviously unintentional——and no more blameworthy

than a typographical error. Further, even the Department's

expert witness conceded that this minor error had no effect on

the appraiser's opinion of value.

39. Paragraphs 20 through 24. The Department asserts that

two of Cartaya's comparables were not comparable for one reason

or another. The Department failed clearly and convincingly to

prove that its allegations of fact concerning the two

comparables in question are true. Thus, the Department failed

to establish its allegations to the requisite degree of

certainty.

Ultimate Factual Determinations

Having examined the entire record; weighed, interpreted,

and judged the credibility of the evidence; drawn (or refused to

draw) permissible factual inferences; resolved conflicting

accounts of what occurred; and applied the applicable law to the

facts, it is determined that:

40. Applying the law governing violations arising under

Section 475.624(2), Florida Statutes, to the historical facts

established in the record by clear and convincing evidence, it

is found as a matter of ultimate fact that Cartaya did not

commit culpable negligence in connection with the appraisals at

issue.

41. Applying the law governing violations arising under

Section 475.624(15), Florida Statutes, to the historical facts

established in the record by clear and convincing evidence, it

is found as a matter of ultimate fact that Cartaya did not fail

to exercise reasonable diligence in developing the appraisals at

issue.

42. Applying the law governing violations arising under

Section 475.624(14), Florida Statutes, to the historical facts

established in the record by clear and convincing evidence, it

is found as a matter of ultimate fact that, in connection with

the Appraisal Report relating to the Hialeah Property, Cartaya

did commit one unintentional violation of Standards Rule 2-

2(b)(vi) of Uniform Standards of Professional Appraisal Practice

and two unintentional violations of Standards Rule 2-2(b)(ix).

CONCLUSIONS OF LAW

43. The Division of Administrative Hearings has personal

and subject matter jurisdiction in this proceeding pursuant to

Sections 120.569 and 120.57(1), Florida Statutes.

44. Section 475.624, Florida Statutes, under which Cartaya

has been charged, sets forth the acts for which the Board may

impose discipline. This statute provides, in pertinent part:

The board may deny an application for

registration, licensure, or certification;

may investigate the actions of any appraiser

registered, licensed, or certified under

this part; may reprimand or impose an

administrative fine not to exceed $5,000 for

each count or separate offense against any

such appraiser; and may revoke or suspend,

for a period not to exceed 10 years, the

registration, license, or certification of

any such appraiser, or place any such

appraiser on probation, if it finds that the

registered trainee, licensee, or

certificateholder:

* * *

(2) Has been guilty of fraud,

misrepresentation, concealment, false

promises, false pretenses, dishonest

conduct, 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

contract, whether written, oral, express, or

implied, in an appraisal assignment; 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 such

misconduct and committed an overt act in

furtherance of such intent, design, or

scheme. It is immaterial to the guilt of

the registered trainee, licensee, or

certificateholder 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

registered trainee, licensee, or

certificateholder, or was an identified

member of the general public.

* * *

(14) Has violated any standard for the

development or communication of a real

estate appraisal or other provision of the

Uniform Standards of Professional Appraisal

Practice.

(15) Has failed or refused to exercise

reasonable diligence in developing an

appraisal or preparing an appraisal report.

45. As a disciplinary statute, Section 475.624 "must be

construed strictly, in favor of the one against whom the penalty

would be imposed." Munch v. Department of Professional

Regulation, Div. of Real Estate , 592 So. 2d 1136, 1143 (Fla. 1st

DCA 1992).

46. A proceeding, such as this one, to suspend, revoke, or

impose other discipline upon a professional license is penal in

nature. State ex rel. Vining v. Florida Real Estate Commission ,

281 So. 2d 487, 491 (Fla. 1973). Accordingly, to impose

discipline, the Department must prove the charges against

Cartaya by clear and convincing evidence. Department of Banking

and Finance, Div. of Securities and Investor Protection v.

Osborne Stern & Co. , 670 So. 2d 932, 933-34 (Fla. 1996)(citing

Ferris v. Turlington , 510 So. 2d 292, 294-95 (Fla. 1987)); Nair

v. Department of Business & Professional Regulation , 654 So. 2d

205, 207 (Fla. 1st DCA 1995).

47. Regarding the standard of proof, in Slomowitz v.

Walker , 429 So. 2d 797, 800 (Fla. 4th DCA 1983), the Court of

Appeal, Fourth District, canvassed the cases to develop a

"workable definition of clear and convincing evidence" and found

that of necessity such a definition would need to contain "both

qualitative and quantitative standards." The court held that

clear and convincing evidence 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.

Id. The Florida Supreme Court later adopted the fourth

district's description of the clear and convincing evidence

standard of proof. Inquiry Concerning a Judge No. 93-62 , 645

So. 2d 398, 404 (Fla. 1994). The First District Court of Appeal

also has followed the Slomowitz test, adding the interpretive

comment that "[a]lthough this standard of proof may be met where

the evidence is in conflict, . . . it seems to preclude evidence

that is ambiguous." Westinghouse Elec. Corp., Inc. v. Shuler

Bros., Inc. , 590 So. 2d 986, 988 (Fla. 1st DCA 1991), rev .

denied , 599 So. 2d 1279 (1992)(citation omitted).

48. The legislature has directed the regulatory boards

falling under the Department's jurisdiction to promulgate rules

specifying the penalties that can be imposed for statutory

offenses. Section 455.2273, Florida Statutes, provides:

(1) Each board, or the department when

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

periodically review the disciplinary

guidelines applicable to each ground for

disciplinary action which may be imposed by

the board, or the department when there is

no board, pursuant to this chapter, the

respective practice acts, and any rule of

the board or department.

(2) The disciplinary guidelines shall

specify a meaningful range of designated

penalties based upon the severity and

repetition of specific offenses, it being

the legislative intent that minor violations

be distinguished from those which endanger

the public health, safety, or welfare; that

such guidelines provide reasonable and

meaningful notice to the public of likely

penalties which may be imposed for

proscribed conduct; and that such penalties

be consistently applied by the board.

(3) A specific finding of mitigating or

aggravating circumstances shall allow the

board to impose a penalty other than that

provided for in such guidelines. If

applicable, the board, or the department

when there is no board, shall adopt by rule

disciplinary guidelines to designate

possible mitigating and aggravating

circumstances and the variation and range of

penalties permitted for such circumstances.

(4) The department must review such

disciplinary guidelines for compliance with

the legislative intent as set forth herein

to determine whether the guidelines

establish a meaningful range of penalties

and may also challenge such rules pursuant

to s. 120.56.

(5) The administrative law judge, in

recommending penalties in any recommended

order, must follow the penalty guidelines

established by the board or department and

must state in writing the mitigating or

aggravating circumstances upon which the

recommended penalty is based.

49. In compliance with this statutory mandate, the Board

has adopted Florida Administrative Code Rule 61J1-8.002, which

sets forth the disciplinary guidelines applicable to the

violations described in Section 475.624, Florida Statutes. The

prescribed penalties, which the undersigned must follow if

punishment is recommended, reveal the Board's judgment as to the

relative severity of the various statutory offenses, providing

an interpretive gloss that is useful in applying the

disciplinary statutes at hand.

Culpable Negligence

50. The penalty ranges for the offenses described in

Section 475.624(2) are set forth in Rule 61J1-8.002(3)(e), where

the several enumerated offenses are grouped into three

categories of decreasing severity or grades of guilt. For ease

of reference, the offenses within these penalty categories can

fairly be denominated "first-degree offenses" (the most

serious), "second-degree offenses," and "third-degree offenses"

(the least serious). In relevant part, Rule 61J1-8.002(3)(e)

provides as follows:

[First-Degree Offenses:] In the case of

fraud, misrepresentation and dishonest

dealing, the usual action of the Board shall

be to impose a penalty of revocation.

[Second-Degree Offenses:] In the case of

concealment, false promises and false

pretenses, the usual action of the Board

shall be to impose a penalty of a 3 to 5

year suspension and an administrative fine

of $1000.

[Third-Degree Offenses:] In the case of

culpable negligence and breach of trust, the

usual action of the Board shall be to impose

a penalty from a $1000 fine to a 1 year

suspension.

51. As the First District Court of Appeal has made clear,

intent is an element of each of these offenses. See Munch , 592

So. 2d at 1143-44. Therefore, the Department must prove

scienter, or guilty knowledge, in order to prove a violation of

Section 475.624(2); it is not enough to show, e.g. , that the

licensee was merely negligent. For that reason, a finding of

guilt entails a strong degree of moral culpability, warranting

the relatively severe penalties that Section 475.624(2) offenses

carry.

52. In the present case, the Department has elected to

travel under the theory that Cartaya exhibited "culpable

negligence" in connection with the appraisals at issue, a third-

degree offense. "Culpable negligence" is a term of art in

criminal law, where it has the following meaning:

"C ulpable negligence consists of: more than

a failure to use ordinary care toward

others. In order for negligence to be

culpable, it must be gross and flagrant.

Culpable negligence is a course of conduct

showing reckless disregard of human life, or

of the safety of persons exposed to its

dangerous effects, or such an entire want of

care as to raise a presumption of a

conscious indifference to consequences, or

which shows wantonness or recklessness, or a

grossly careless disregard of the safety and

welfare of the public, or such an

indifference to the rights of others as is

equivalent to an intentional violation of

such rights. The negligent act or omission

must have been committed with an utter

disregard for the safety of others.

Culpable negligence is consciously doing an

act or following a course of conduct that

the defendant must have known, or reasonably

should have known, was likely to cause death

or great bodily injury."

Carrin v. State , 875 So. 2d 719, 721 (Fla. 1st DCA 2004)(quoting

Logan v. State , 592 So. 2d 295, 298 (Fla. 5th DCA 1991)).

53. In the instant context, financial damage or loss, not

bodily injury, is the harm against which the disciplinary

statute affords protection. Nevertheless, the above definition

of "culpable negligence" works well here. The requisite state

of mind is a conscious indifference to consequences, which can

be inferred from direct proof of reckless or wanton behavior.

54. The fact-finder is not convinced, and thus could not

find above, that Cartaya prepared the appraisals at issue with

conscious indifference to the consequences. Hence Cartaya has

been found not guilty of culpable negligence as a matter of

ultimate fact.

Reasonable Diligence

55. The penalty range for failing or refusing to exercise

reasonable diligence is as follows:

The usual action of the Board shall be to

impose a penalty from a 5 year suspension to

revocation and an administrative fine of

$1000.

Fla. Admin. Code R. 61J1-8.002(3)(r). Comparing this penalty

range to the penalties prescribed for the Section 475.624(2)

offenses shows that the Board views the offense of failure to

use reasonable diligence as being somewhat more serious than the

second-degree offenses of promissory fraud and concealment

(since revocation is a potential punishment for lack of

diligence) and somewhat less serious than ordinary fraud and

dishonest dealing, those first-degree offenses for which the

lesser penalty of suspension is not usually allowed.

56. Because the Board plainly considers the Section

475.624(15) offense to be more serious than culpable negligence

(a third-degree offense, an element of which is the mens rea of

conscious indifference to consequences), it is obvious that

merely negligent conduct (which need not be undertaken with

guilty knowledge or intent) cannot support a finding of guilt on

the charge of failure to use reasonable diligence. Standing

implicitly behind the penalties prescribed in Rule 61J1-

8.002(3)(r), therefore, is the Board's construction of Section

475.624(15) as requiring an intentional act. The requisite

state of mind for this offense, it is concluded, is willful

inattention, a deliberate failure or refusal or exercise

reasonable diligence in the preparation of an appraisal.

57. The undersigned is not convinced that Cartaya was

willfully inattentive to her work in preparing the appraisals in

question. To the contrary, she seems to have intended to devote

such care and attention to these appraisals as was reasonable

under the circumstances. Thus, Cartaya was found not guilty, as

a matter of ultimate fact, on the charge of failing or refusing

to exercise reasonable diligence.

Uniform Standards of Professional Appraisal Practice

58. Florida-certified appraisers are obligated to comply

with the Uniform Standards of Professional Appraisal Practice

("USPAP"), a code of conduct for appraisers developed and

published by a private entity known as the Appraisal Standards

Board of the Appraisal Foundation. Section 475.628, Florida

statutes, provides:

Each appraiser registered, licensed, or

certified under this part shall comply with

the Uniform Standards of Professional

Appraisal Practice. Statements on appraisal

standards which may be issued for the

purpose of clarification, interpretation,

explanation, or elaboration through the

Appraisal Foundation shall also be binding

on any appraiser registered, licensed, or

certified under this part.

Section 475.624(14) makes it a disciplinable offense to violate

"any standard" prescribed in USPAP.

59. The penalty range for a violation of USPAP is

identical to that prescribed for the Section 475.625(15) offense

of failing to use reasonable diligence. Rule 61J1-8.002(3)(q)

provides that as punishment for a violation of USPAP, "[t]he

usual action of the Board shall be to impose a penalty from a 5

year suspension to revocation and an administrative fine of

$1000."

60. Implicit in this penalty range is the Board's view

that violating a USPAP standard is roughly as serious, in the

main, as committing promissory fraud or ordinary fraud, see Rule

61J1-8.002(3)(e), both of which are characterized by an intent

to deceive. To underscore the significance of this point, take

note that the Board has chosen to punish culpable negligence

with less severe penalties than are authorized for violating a

USPAP standard. Compare Rule 61J1-8.002(3)(e) with 61J1-

8.002(3)(q). It would be patently anomalous (and grossly

unfair) to penalize innocently incorrect——or even merely

negligent——conduct that happens to violate a USPAP standard more

harshly than culpably negligent conduct that does not violate

USPAP, despite being undertaken recklessly, with a conscious

indifference to the consequences. Thus, while Section

475.624(14) might be read on its face as describing a strict

liability offense, the Board implicitly has construed the

statute to require an element of intent, at least in the usual

circumstances.

61. This interpretation cannot hold in all circumstances,

however, because, as will be seen, USPAP clearly proscribes

merely negligent conduct in some instances. Thus, it is

concluded that, where a violation of USPAP can be shown without

proof of the licensee's wrongful intent, the absence of guilty

knowledge is a mitigating factor that permits a downward

departure from the prescribed range of penalties.

62. Before turning to the specific charges under USPAP, a

couple of preliminary observations are in order. First, the

Department did not mention, in its Administrative Complaints,

the specific USPAP provisions that it believed Cartaya had

violated, saving the details for its Proposed Recommended Order.

Arguably the Department's factual allegations were adequate to

place Cartaya on notice of the charges against her, and, to be

sure, Cartaya could have pinned down the Department as to the

particulars via discovery, but it is nevertheless somewhat

disconcerting that the Department's Proposed Recommended Order

has unleashed a barrage of accusations regarding multiple

alleged violations of various USPAP provisions, the effect of

which is to change the complexion of the case. Because Cartaya

has not argued that this infringed her due process rights,

however, the matter will not be further pursued here.

63. Second, the Department did not offer the relevant

USPAP provisions into evidence or ask that official recognition

of them be taken. The provisions of USPAP are facts that the

Department needed to prove, and its failure to do so is arguably

fatal to its prosecution of Count III of Case No. 04-1680 and

Counts II and IV of Case No. 04-1148. On the other hand, the

Department has quoted USPAP provisions in its Proposed

Recommended Order, as has Cartaya herself. Put another way,

neither party has made an issue out of the Department's failure

properly to place USPAP into the evidentiary record; instead

each has proceeded as if the "formality" of this proof can be

dispensed with.

64. The problem with the parties' casual approach is that,

without independent access to the text, the undersigned cannot

read the USPAP provisions in context, or even be sure that what

the parties have quoted is accurate. As it happens, the

undersigned has found the current version of USPAP, which is

published on the internet, 15 and hence could study the uniform

standards were it appropriate to do so. Because the parties

have taken the liberty of relying upon and quoting USPAP despite

the fact that USPAP is outside the record in this case, the

undersigned has elected to review and rely upon the electronic

version of USPAP. Whether doing so constitutes legal error is

an issue that the parties can argue in another forum if need be.

65. The Department alleges that Cartaya violated the

following USPAP standards, including the comments thereto, which

latter are set forth in the endnotes:

Standards Rule 1-1

(This Standards Rule contains binding

requirements from which departure is not

permitted.)

In developing a real property appraisal, an

appraiser must:

(a) be aware of, understand, and correctly

employ those recognized methods and

techniques that are necessary to produce a

credible appraisal;[ 16 ]

(b) not commit a substantial error of

omission or commission that significantly

affects an appraisal; and[ 17 ]

(c) not render appraisal services in a

careless or negligent manner, such as by

making a series of errors that, although

individually might not significantly affect

the results of an appraisal, in the aggregate

affects the credibility of those results.[ 18 ]

Standards Rule 1-4

(This Standards Rule contains specific

requirements from which departure is

permitted. See the DEPARTURE RULE.)

In developing a real property appraisal, an

appraiser must collect, verify, and analyze

all information applicable to the appraisal

problem, given the scope of work identified

in accordance with Standards Rule 1-2(f).

(a) When a sales comparison approach is

applicable, an appraiser must analyze such

comparable sales data as are available to

indicate a value conclusion.

Standards Rule 1-5

(This Standards Rule contains binding

requirements from which departure is not

permitted.)

In developing a real property appraisal, when

the value opinion to be developed is market

value, an appraiser must, if such information

is available to the appraiser in the normal

course of business:

(a) analyze all agreements of sale, options,

or listings of the subject property current

as of the effective date of the appraisal;

and

(b) analyze all sales of the subject

property that occurred within the three (3)

years prior to the effective date of the

appraisal.

Standards Rule 2-2

(This Standards Rule contains binding

requirements from which departure is not

permitted.)

Each written real property appraisal report

must be prepared under one of the following

three options and prominently state which

option is used: Self-Contained Appraisal

Report, Summary Appraisal Report, or

Restricted Use Appraisal Report.[ 19 ]

* * *

(b) The content of a Summary Appraisal

Report must be consistent with the intended

use of the appraisal and, at a minimum:[ 20 ]

* * *

(vi) state the effective date of the

appraisal and the date of the report;[ 21 ]

* * *

(ix) summarize the information analyzed, the

appraisal procedures followed, and the

reasoning that supports the analyses,

opinions, and conclusions;[ 22 ]

66. The Department contends that Cartaya violated

Standards Rule 2-2(b)(vi) in connection with the appraisal of

the Hialeah Property by stating, in her Appraisal Report, both

an incorrect effective date as well an erroneous report date.

The Department's position is only partially persuasive. What

Cartaya got wrong was the date of the report, for she mistakenly

represented that the Appraisal Report had been signed on July

27, 2000, when in fact the correct date was August 7, 2000. The

Department has failed convincingly to prove, however, that the

effective date of Cartaya's appraisal of the Hialeah Property

was not July 27, 2000, as stated in the Appraisal Report. Thus,

the Department has established an unintentional violation of

Standards Rule 2-2(b)(vi).

67. The Department asserts that Cartaya violated Standards

Rules 1-5(b) and 2-2(b)(ix) by failing to disclose, in her

Appraisal Report on the Hialeah Property, the sale to Hornedo

that was scheduled to close on July 28, 2000, which was a "prior

sale" of the subject property, according to the Department.

This argument fails because the sale to Hornedo occurred one day

after the effective date of Cartaya's appraisal of the Hialeah

Property. However, Cartaya's mistake in dating the report as of

the effective date of the appraisal obscured the fact that her

opinion of value was effectively retroactive to a point in time

that pre-dated a material transaction relating to the value of

the subject property. Although the undersigned is convinced

that Cartaya did not intend to deceive her client (which knew

all about the Fannie Mae-Hornedo transaction in any event), the

fact that the Appraisal Report failed clearly to reveal the

retroactive nature of Cartaya's opinion of value meant that the

rationale for the opinions and conclusions was insufficiently

expressed. Thus, the Department has established an

unintentional violation of Standards Rule 2-2(b)(ix).

68. The Department argues that Cartaya violated Standards

Rules 1-5(a) and 2-2(b)(ix) by failing to disclose, in her

Appraisal Report on the Hialeah Property, that the listing price

for the subject property had changed several times in the months

preceding her appraisal. This argument is not as compelling as

the Department believes, because Standards Rule 1-5(a) requires

the appraiser to analyze listings and agreements of sale

"current as of the effective date of the appraisal," which date

in this case was July 27, 2000. Listings that were not current

as of July 27, 2000, could be ignored without running afoul of

Standards Rule 1-5(a). That said, Cartaya should have included

in her Appraisal Report some reference to the Fannie Mae-Hornedo

transaction, which was the subject of an agreement of sale

current as of the effective date of the appraisal. Cartaya's

failure to include a summary of her analysis of the pending sale

constituted a violation of Standards Rule 2-2(b)(ix). The

undersigned is not convinced, however, that this failure was

willful.

69. The Department argues that Cartaya violated Standards

Rules 1-5(a) and 2-2(b)(ix) by failing to disclose, in her

Appraisal Report on the Hialeah Property, the supposed asking

price/sales price differential with respect to "comparable one."

The Department failed to prove that there was in fact such a

differential, so this charge necessarily fails. Moreover,

Standards Rule 1-5(a) requires that listing and sales prices for

the subject property be analyzed; it says nothing about

comparable properties, and thus could not have been violated in

the way the Department contends in regard to this "comparable

one."

70. The Department asserts that Cartaya committed multiple

violations in connection with the comparables used in the

appraisals of 1729 NW 18th St and 18032 NW 48th Place. The

undersigned, however, has found as a matter of fact that the

Department failed clearly and convincingly to prove that Cartaya

chose inappropriate comparables for these properties. Thus, the

instant accusations must fail.

Mitigating Circumstances

71. Florida Administrative Code Rule 61J1-8.002(4)

provides as follows:

(4)(a) When either the petitioner or

respondent is able to demonstrate

aggravating or mitigating circumstances to

the Board by clear and convincing evidence,

the Board shall be entitled to deviate from

the above guidelines in imposing discipline

upon a licensee. Whenever the petitioner or

respondent intends to introduce such

evidence to the Board in a Section

120.57(2), F.S., hearing, advance notice of

no less than seven (7) days shall be given

to the other party or else the evidence can

be properly excluded by the Board.

(b) Aggravating or mitigating circumstances

may include, but are not limited to, the

following:

1. The degree of harm to the consumer or

public.

2. The number of counts in the

administrative complaint.

3. The disciplinary history of the

licensee.

4. The status of the licensee at the time

the offense was committed.

5. The degree of financial hardship

incurred by a licensee as a result of the

imposition of a fine or suspension of the

license.

6. Violation of the provision of Part II of

Chapter 475, F.S., wherein a letter of

guidance as provided in Section 455.225(3),

F.S., previously has been issued to the

licensee.

72. As mitigating factors, the undersigned finds that the

no harm to any consumer or the public resulted from Cartaya's

violations of USPAP. Further, none of the violations was

intentional; at worst, Cartaya was negligent, but it is at least

equally as likely that she thought she was complying with USPAP

even as she failed to do so. Finally, Cartaya has a clean

disciplinary record. She is not a repeat offender.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Board enter a final order

finding that:

(1) As to Case No. 04-1148, Cartaya is not guilty on

Counts I through VI, inclusive;

(2) As to Case No. 04-1680, Cartaya is not guilty on

Counts I, II, and IV; she is, however, guilty, under Count III,

of one unintentional violation of Standards Rule 2-2(b)(vi) and

two unintentional violations of Standards Rule 2-2(b)(ix).

(3) As punishment for the violations established,

Cartaya's certificate should be suspended for 30 calendar days,

and she should be placed on probation for a period of one year,

a condition of such probation being the successful completion of

a continuing education course in USPAP. In addition, Cartaya

should be ordered to pay an administrative fine of $500.

DONE AND ENTERED this 10th day of November, 2004, in

Tallahassee, Leon County, Florida.

___________________________________

JOHN G. VAN LANINGHAM

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 10th day of November, 2004.

ENDNOTES

1 / To be clear, the undersigned is not finding here that the

Department's allegations are true. Rather, he is simply

repeating, for the reader's benefit, what the Department has

alleged.

2 / In its Proposed Recommended Order, the Department has pursued

only the allegation of culpable negligence, effectively

abandoning the charges of fraud, misrepresentation, concealment,

false promises, false pretenses, dishonest conduct, and breach

of trust. As to these latter offenses, then, Cartaya is found

not guilty without further comment.

3 / In its Proposed Recommended Order, the Department conceded

that it had failed to prove this charge——an assessment with

which the undersigned agrees. Thus, Cartaya is not guilty of

violating Section 475.624(17).

4 / The findings in paragraphs 7 through 13 of this Recommended

Order are based largely on the so-called "Report History" that

Cartaya prepared for the Department on October 24, 2001. This

Report History was attached to the Administrative Complaint as

Exhibit 1 and was received in evidence at hearing as

Petitioner's Exhibit 19. The statements that Cartaya made in

the Report History, having been offered against her at hearing,

are admissible as substantive evidence under the "admissions"

exception to the hearsay rule. See § 90.802(18)(a), Fla. Stat.

5 / The Appraisal Report states, apparently erroneously, that

Cartaya signed the report on July 27, 2000.

6 / In paragraph 16 of the Amended Complaint, the Department

alleged that the "public records reflect that the subject

property is of mixed construction." The undersigned does not

know to what "public records" the Department was referring but

emphasizes that there is insufficient nonhearsay evidence in the

record to convince him that the Hialeah Property is of "mixed

construction."

7 / In its Proposed Recommended Order, the Department contends,

on the authority of Section 475.28(2), Florida Statutes, that

Cartaya's entire workfile is competent evidence, standing alone,

of the truth of any matter to which reference was made in any

document contained therein. Section 475.28(2) provides:

Photostatic copies of any papers or

documents may be introduced in lieu of the

originals in any proceeding or prosecution

under this chapter. The books of account and

records of any person shall be admissible

upon a showing that they were made in the

regular course of business, without

introducing the person who made the entries,

the weight of such evidence to be decided by

the court or commission.

The Department misperceives the operation of Section 475.28(2).

First, the admissibility of Cartaya's workfile was not really an

issue, because the file was admissible for nonhearsay purposes

(such as to show whether she had properly maintained a workfile

in accordance with governing law) having nothing to do with the

truth of the matters asserted therein. Ruling that a document

is "admissible" is not the equivalent of deeming it competent

proof of the truth of its contents. Second, while Section

475.28(2) arguably relaxes the "business records exception" to

the hearsay rule, it nevertheless requires that the offering

party lay a predicate, namely that each record have been made in

the regular course of business. In this case, Cartaya's

workfile contains materials that she did not make , but rather

received in the regular course of business. Regarding these

documents that Cartaya did not make, there is no persuasive

evidence ( i.e. testimony by a witness having personal knowledge)

showing that any of them were made in the regular course of

business. Absent the proper predicate, these materials are

simply uncorroborated hearsay, which cannot support of finding

of fact. See § 120.57(1)(c), Fla. Stat. Finally, even if all

the papers in Cartaya's workfile were admissible as substantive

evidence, determining the weight of that evidence is exclusively

the province of the undersigned as fact-finder. To the extent

that the findings of fact herein ignore——or are in conflict

with——any assertion made in any document contained in Cartaya's

workfile, it is because the undersigned, in sifting through and

weighing the evidence, determined that the matters ignored or

rejected were insufficiently probative to clearly convince the

undersigned of their truth.

8 / See § 90.801(1)(c), Fla. Stat. (defining "hearsay" as "a

statement, other than one made by the declarant while testifying

at the trial or hearing, offered in evidence to prove the truth

of the matter asserted.").

9 / See § 120.57(1)(c), Fla. Stat. ("Hearsay evidence may be used

for the purpose of supplementing or explaining other evidence,

but it shall not be sufficient in itself to support a finding

unless it would be admissible over objection in civil actions.")

10 / Logically, if there were no zoning violations, then there

was nothing for Cartaya to fail or refuse to explain or make

adjustments for.

11 / The Yeomans Report repeats measurements for frontage and lot

size without identifying the source thereof. There is no

persuasive evidence that Mr. Yeomans had personal knowledge of

these measurements; rather, the likelihood is that he obtained

the figures from some reference extrinsic to himself. Thus, the

figures in the Yeomans Report are considered hearsay for which

no exception to the hearsay rule was established.

12 / A statement must be an "assertion" to be hearsay. See §

90.801(1)(a), Fla. Stat. (defining "statement" as an

"assertion"). An "assertion" is a "positive declaration" that

communicates a thought, idea, or fact. See , e.g. , Lark v.

State , 617 So. 2d 782, 789 (Fla. 1st DCA)(query was not

assertion), rev. denied , 626 So. 2d 208 (Fla. 1993). Legal

codes are prescriptive rather than assertive and hence are to be

obeyed rather than believed.

13 / The legitimacy and authority of a legal code arise not from

its fidelity to fact or reality ( i.e. its "truth") but from the

source of the law and the lawgiver's power to enforce it.

14 / Taken together, the terms of a zoning code as it exists at

any given point in time comprise an objective fact that

ordinarily should be proved by offering a true and correct ( i.e.

properly authenticated) copy of the pertinent text. (Expert

opinion testimony is neither necessary nor even appropriate

proof of the provisions of a legal code, because the terms of a

written text are not matters of opinion or beyond the ken of any

literate human being to comprehend.) Although it is permissible

for a witness with personal knowledge of the code's terms to

testify about them over a hearsay objection, as acknowledged

above, such testimony is inherently unconvincing, for several

reasons. First, no one is likely to recall every detail

accurately, and details matter in dealing with a legal code.

Second, the fact-finder has no idea whether the witness examined

every potentially relevant provision of the code in question,

and completeness counts in dealing with a legal code. Third,

without the text of the code, it is impossible for the fact-

finder to evaluate whether the witness is repeating verbatim

what he has read in the code (as fact), or rather is offering an

interpretation based on the memory of what he has seen (which

would amount to an inadmissible legal opinion regarding the

code's meaning). At bottom, as proof of a legal code, fact

witness testimony is simply too unreliable to constitute clear

and convincing evidence.

15 / See

.

16 / Comment : This Rule recognizes that the principle of change

continues to affect the manner in which appraisers perform

appraisal services. Changes and developments in the real estate

field have a substantial impact on the appraisal profession.

Important changes in the cost and manner of constructing and

marketing commercial, industrial, and residential real estate as

well as changes in the legal framework in which real property

rights and interests are created, conveyed, and mortgaged have

resulted in corresponding changes in appraisal theory and

practice. Social change has also had an effect on appraisal

theory and practice. To keep abreast of these changes and

developments, the appraisal profession is constantly reviewing

and revising appraisal methods and techniques and devising new

methods and techniques to meet new circumstances. For this

reason, it is not sufficient for appraisers to simply maintain

the skills and the knowledge they possess when they become

appraisers. Each appraiser must continuously improve his or her

skills to remain proficient in real property appraisal.

17 / Comment : In performing appraisal services, an appraiser

must be certain that the gathering of factual information is

conducted in a manner that is sufficiently diligent, given the

scope of work as identified according to Standards Rule 1-2(f),

to ensure that the data that would have a material or

significant effect on the resulting opinions or conclusions are

identified and, where necessary, analyzed. Further, an

appraiser must use sufficient care in analyzing such data to

avoid errors that would significantly affect his or her opinions

and conclusions.

18 / Comment : Perfection is impossible to attain, and competence

does not require perfection. However, an appraiser must not

render appraisal services in a careless or negligent manner.

This Standards Rule requires an appraiser to use due diligence

and due care.

19 / Comment : When the intended users include parties other than

the client, either a Self-Contained Appraisal Report or a Summary

Appraisal Report must be provided. When the intended users do not

include parties other than the client, a Restricted Use Appraisal

Report may be provided.

The essential difference among these three options is in the

content and level of information provided.

An appraiser must use care when characterizing the type of

report and level of information communicated upon completion of

an assignment. An appraiser may use any other label in addition

to, but not in place of, the label set forth in this Standard for

the type of report provided.

The report content and level of information requirements set

forth in this Standard are minimums for each type of report. An

appraiser must supplement a report form, when necessary, to

ensure that any intended user of the appraisal is not misled and

that the report complies with the applicable content requirements

set forth in this Standards Rule.

A party receiving a copy of a Self-Contained Appraisal

Report, Summary Appraisal Report, or Restricted Use Appraisal

Report in order to satisfy disclosure requirements does not

become an intended user of the appraisal unless the appraiser

identifies such party as an intended user as part of the

assignment.

20 / Comment : The essential difference between the Self-Contained

Appraisal Report and the Summary Appraisal Report is the level of

detail of presentation.

21 / Comment : The effective date of the appraisal establishes the

context for the value opinion, while the date of the report

indicates whether the perspective of the appraiser on the market

or property use conditions as of the effective date of the

appraisal was prospective, current, or retrospective.

Reiteration of the date of the report and the effective

date of the appraisal at various stages of the report in

tandem is important for the clear understanding of the

reader whenever market or property use conditions on the

date of the report are different from such conditions on the

effective date of the appraisal.

22 / Comment : The appraiser must be certain that the information

provided is sufficient for the client and intended users to

adequately understand the rationale for the opinions and

conclusions.

When the purpose of an assignment is to develop an opinion

of market value, a summary of the results of analyzing the

information required in Standards Rules 1-5 and 1-6 is required.

If such information is unobtainable, a statement on the efforts

undertaken by the appraiser to obtain the information is

required. If such information is irrelevant, a statement

acknowledging the existence of the information and citing its

lack of relevance is required.

COPIES FURNISHED :

Alfonso Santana, Esquire

Department of Business and

Professional Regulation

400 West Robinson Street, Suite 801N

Orlando, Florida 32801-1757

Jerome H. Shevin, Esquire

Levey, Airan, Brownstein, Shevin,

Friedman, Roen & Kelso, LLP

Gables One Tower, Penthouse

1320 South Dixie Highway, PH 1275

Coral Gables, Florida 33146

Juana Watkins, Acting Director

Division of Real Estate

Department of Business and

Professional regulation

400 West Robinson Street, Suite 802 North

Orlando, Florida 32801

Leon Biegalski, General Counsel

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399-2202

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.