04-002279 John Stephens, Inc. vs. C &Amp; J Fruit And Melons, Inc., And Auto Owners Insurance Status: Closed Recommended Order on Wednesday, December 29, 2004.

Summary: Recommend that C & J Fruit and Melons, Inc., owes money for citrus sold delivered in the sum of $18,857.00.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

JOHN STEPHENS, INC., )

)

Petitioner, )

)

vs. ) Case No. 04 - 2279

)

C & J FRUIT AND MELONS, INC., )

AND AUTO OWNERS INSURANCE, )

)

Respondents. )

)

R ECOMMENDED ORDER

Pursuant to notice, the above - styled matter was heard

before Daniel M. Kilbride, Administrative Law Judge of the

Division of Administrative Hearings, on October 8, 2004, in

Lakeland, Florida. The following appearances were entered:

APPE ARANCES

For Petitioner: John A. Stephens

General Manager and Director

John Stephens, Inc.

Post Office Box 1098

Fort Meade, Florida 33841

For Respondent C & J Fruit and Melons, Inc.:

No appearance

For Respondent Auto Owners Insurance:

Jason Lowe, Esquire

GrayRobinson, P.A.

Post Office Box 3

Lakeland, Florida 33802

STATEMENT OF THE ISSUE

Whether Respondent, C & J Fruit and Melons, Inc. (C & J

Fruit), a citrus fruit dealer and registered pac ker, owes

Petitioner, John Stephens, Inc., a citrus dealer, a sum of money

for grapefruit and oranges sold and delivered to C & J Fruit's

citrus fruit - packing house for processing.

PRELIMINARY STATEMENT

On or about April 23, 2003, Petitioner, John Stephen s,

Inc., filed a complaint with the Florida Department of

Agriculture and Consumer Services (Department) alleging that

Respondent, C & J Fruit & Melons, Inc., owes Petitioner the sum

of $18,857.00, for citrus fruit sold and delivered during the

2001 - 2002 c itrus shipping season. C & J Fruit filed an answer

denying the claim. Subsequently, on June 28, 2004, this matter

was referred to the Division of Administrative Hearings to

conduct a formal hearing pursuant to Section 120.569 and

Subsection 120.57(1), Fl orida Statutes (2004). Counsel for

Respondent, Auto Owners Insurance (Auto Owners), filed a notice

of appearance and discovery ensued. This matter was set for

hearing on September 9, 2004; however, due to inclement weather,

the case was continued until O ctober 8, 2004.

At the hearing, C & J Fruit did not appear. Diligent

search and inquiry was made to locate a former officer of the

corporation, which is no longer in business. Clemon Browne, the

former principle of the corporation, could not be found.

However, his deposition was subsequently admitted in evidence as

Petitioner's Exhibit 1. Auto Owners was represented and both

parties were ready to proceed. After waiting an appropriate

period of time, the hearing was commenced. Petitioner presented

the testimony of three witnesses and offered seven exhibits in

evidence, which were admitted over objection. Auto Owners

participated in the cross - examination of witnesses, but did not

offer any witnesses or exhibits in evidence.

The Transcript of the heari ng was filed on October 20,

2004. Both parties requested the opportunity to submit post -

hearing proposals. However, neither Petitioner nor either of

the Respondents has filed proposed findings of fact at the time

of the preparation of this Recommended Or der.

Based upon all of the evidence, the following findings of

fact are determined:

FINDINGS OF FACT

1. Petitioner, John Stephens, Inc., is a Florida - licensed

citrus fruit dealer operating within the Department of

Agriculture and Consumer Services' regu latory jurisdiction.

2. Respondent, C & J Fruit & Melons, Inc., was a Florida -

licensed citrus fruit dealer and operated a registered packing

house in Frostproof, Florida, during the 2001 - 2002 citrus

shipping season.

3. Respondent, Auto Owners Insurance , was the surety for

C & J Fruit's citrus fruit dealer's license in the amount of

$14,000.00, for the 2001 - 2002 season.

4. At the beginning of the 2001 - 2002 season, Petitioner

and C & J Fruit entered into a verbal contract under which

Petitioner agreed t o contract with various grove owners and

grove harvesters in the Polk County, Florida, area. The

understanding was that Petitioner would obtain various varieties

of grapefruit, oranges, and tangerines from the growers and

harvesters and deliver the fruit to C & J Fruit's packing house.

Petitioner was responsible for payment to the grove owners and

harvesters. C & J Fruit would process the fruit, supply the

citrus fruit to retail and wholesale suppliers, and account and

pay for the fruit received from Pet itioner.

5. Petitioner and C & J Fruit had conducted business in

this fashion for many years prior to this season.

6. On October 23, 2001, C & J Fruit sought protection from

creditors under Chapter 11 of the United States Bankruptcy Code

in the U.S. Ba nkruptcy Court, Middle District of Florida, Tampa

Division, Case No. 01 - 19821 - 8W1.

7. Following the filing of bankruptcy, no other supplier

would provide C & J Fruit with citrus fruit. With Petitioner's

consent, C & J Fruit filed an emergency motion to authorize a

secured interest to Petitioner, if it would continue to supply

C & J Fruit's packing house with fruit. The bankruptcy court

granted the motion, and in November 2001, Petitioner began

supplying C & J Fruit's packing house with fresh citrus frui t.

8. The preponderance of evidence proves that Petitioner

delivered to C & J Fruit's packing house during November 2001

pursuant to the contract: 540 boxes of grapefruit at $3.00 per

box for a total of $1,620.00; 3,044 boxes of oranges at $4.00

per box for a total of $12,176.00; 330 boxes of tangerines at

$3.50 per box for a total of $1,155.00; and 1,953 boxes of navel

oranges at $2.00 per box for a total of $3,906.00. C & J Fruit

was billed for this amount. Accordingly, C & J Fruit was

obligated to p ay Petitioner the total sum of $18,857.00 for the

fruit. When payment was not received in a timely matter,

shipment of citrus fruit to the packing house was discontinued.

9. Petitioner performed all of its duties under the

contract, and C & J Fruit fail ed to pay or account for the

citrus fruit delivered to its packing house under the terms of

the contract. C & J Fruit is, therefore, indebted to Petitioner

in the amount of $18,857.00

CONCLUSIONS OF LAW

10. The Division of Administrative Hearings has

ju risdiction over the subject matter of this proceeding and the

parties thereto pursuant to Section 120.569 and Subsection

120.57(1), Florida Statutes (2004).

11. Chapter 601, Florida Statutes (2002), is known as "The

Florida Citrus Code of 1949" and is en forced by the Department.

12. "Citrus fruit" is defined in Subsection 601.03(7),

Florida Statutes (2002), as

[A]ll varieties and regulated hybrids of

citrus fruit and also means processed citrus

products containing 20 percent or more

citrus fruit or ci trus fruit juice, but, for

the purposes of this chapter, shall not mean

limes, lemons, marmalade, jellies,

preserves, candies, or citrus hybrids for

which no specific standards have been

established by the Department of

Citrus; . . . .

Additionally, the term "grapefruit" is defined to mean "the

fruit Citrus paradisi Macf. , commonly called grapefruit and shall

include white, red, and pink meated varieties . . . ."

§ 601.03(22), Fla. Stat. (2002).

13. A "citrus fruit dealer" is defined in Subsection

601. 03(8), Florida Statutes (2002), as

[A]ny consignor, commission merchant,

consignment shipper, cash buyer, broker,

association, cooperative association,

express or gift fruit shipper, or person who

in any manner makes or attempts to make

money or other th ing of value on citrus

fruit in any manner whatsoever, other than

of growing or producing citrus fruit, but

the term shall not include retail

establishments whose sales are direct to

consumers and not for resale or persons or

firms trading solely in citrus futures

contracts on a regulated commodity

exchange; . . . .

14. Both Petitioner and C & J Fruit are citrus fruit

dealers under this definition. C & J Fruit was also authorized

to operate a packing house in Frostproof, Florida, and to pack

and ship ci trus fruit for market for the 2001 - 2002 season.

15. Citrus fruit dealers are required to be licensed by

the Department in order to transact business in Florida.

§ 601.55(1), Fla. Stat. (2002). As a condition of obtaining a

license, such dealers are requ ired to provide a cash bond, a

certificate of deposit, or a surety bond in an amount to be

determined by the Department "for the use and benefit of every

producer and of every citrus fruit dealer with whom the dealer

deals in the purchase, handling, sale, and accounting of

purchases and sales of citrus fruit." § 601.61(3), Fla. Stat.

(2002).

16. Section 601.65, Florida Statutes (2002), provides that

"[i]f any licensed citrus fruit dealer violates any provision of

this chapter, such dealer shall be liable to the person

allegedly injured thereby for the full amount of damages

sustained in consequence of such violation." This liability may

be adjudicated in an administrative action brought before the

Department or in a "judicial suit at law in a court of com petent

jurisdiction."

17. Subsection 601.64(4), Florida Statutes (2002), defines

as an "unlawful act" by a citrus fruit dealer the failure to pay

promptly and fully, as promised, for any citrus fruit which is

the subject of a transaction relating to the purchase and sale

of such goods.

18. Any person may file a complaint with the Department

alleging a violation of the provisions of Chapter 601, Florida

Statutes (2002), by a citrus fruit dealer. § 601.66(1), Fla.

Stat. (2002). The Department is charged with the

responsibilities of determining whether the allegations of the

complaint have been established and adjudicating the amount of

indebtedness or damages owed by the citrus fruit dealer.

§ 601.66(5), Fla. Stat. (2002). If the complaining party prov es

its case, the Department shall "fix a reasonable time within

which said indebtedness shall be paid by the [citrus fruit]

dealer." Thereafter, if the dealer does not pay within the time

specified by the Department, the Department shall obtain payment

of the damages from the dealer’s surety company, up to the

amount of the bond. § 601.66(5) and (6), Fla. Stat. (2002).

19. Petitioner bore the burden of proving the allegations

in its Complaint against C & J Fruit by a preponderance of the

evidence. See F lorida Department of Transportation v. J.W.C.

Co., Inc. , 396 So. 2d 778, 788 (Fla. 1st DCA 1981); Florida

Department of Health and Rehabilitative Services v. Career

Service Commission , 289 So. 2d 412, 415 (Fla. 4th DCA 1974); and

§ 120.57(1)(j), Fla. Stat. (2004).

20. Petitioner carried its burden of proving that

C & J Fruit failed and refused to pay, as agreed, for citrus

fruit that Petitioner delivered to C & J Fruit’s packing house

in Frostproof, Florida.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of

law, it is

RECOMMENDED that a final order be entered requiring

Respondent, C & J Fruit and Melons, Inc., to pay to Petitioner,

John Stephens, Inc., the sum of $18,857.00.

DONE AND ENTERED this 29th day of December, 2004, in

Tal lahassee, Leon County, Florida.

S

DANIEL M. KILBRIDE

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 96 75

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 29th day of December, 2004.

COPIES FURNISHED :

Brenda D. Hyatt, Bureau Chief

Bureau of License and Bond

Department of Agriculture and

Consumer Services

407 South Calhoun Street, Mail Station 38

Tallahassee, Florida 32399 - 0800

Honorable Charles H. Bronson

Commissioner of Agriculture and

Consumer Services

The Capitol, Plaza Level 10

Tallahassee, Florida 32399 - 0810

Richard D. T ritschler, General Counsel

Department of Agriculture and

Consumer Services

The Capitol, Plaza Level 10

Tallahassee, Florida 32399 - 0810

Clemon Browne, President

C & J Fruit & Melons, Inc.

Post Office Box 130

Lake Hamilton, Florida 33851 - 0130

John A. S tephens

John Stephens, Inc.

Post Office Box 1098

Fort Meade, Florida 33841

Jason Lowe, Esquire

GrayRobinson, P.A.

Post Office Box 3

Lakeland, Florida 33802

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions w ithin

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.