06-001418 Stephen Peter Alicino vs. Department Of Financial Services Status: Closed Recommended Order on Tuesday, July 11, 2006.

Summary: Petitioner did not demonstrate his entitlement to a license as a resident personal lines insurance agent because he failed to satisfy six judgements against him requiring the return of unearned commissions.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STEPHEN PETER ALICINO , )

)

Petitioner , )

)

vs. ) Case No. 06 - 1418

)

DEPARTMENT OF FINANCIAL )

SERVICES , )

)

Respondent . )

)

RECOMMENDED ORDER

Purs uant to notice a formal hearing was held in this case

on June 6, 2006, before Bram D. E. Canter, an Administrative Law

Judge of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Stephen Peter Alicino, pro se

4 34 Polk Avenue

Cape Canaveral, Florida 32920

For Respondent: Dickson E. Kessler, Esquire

Department of Financial Services

Suite S - 823, Hurston Building

400 West Robinson Street

Orlando, Florida 32801

STATEMENT OF THE ISSUE

The issue in this case is whether Petitioner is entitled to

be licensed as a "resident personal lines" insurance agent.

PRELIMINARY STATEMENT

On February 16, 2006, Resp ondent Department of Financial

Services (Department) issued a Notice of Denial, in which it

informed Petitioner that his application for licensure as a

resident personal lines insurance agent was denied. Petitioner

timely sought an administrative review o f that decision , and the

matter was forwarded to the Division of Administrative Hearings

(DOAH) to conduct a formal evidentiary hearing.

At the hearing, Petitioner testified on his own behalf.

Petitioner's Exhibit 1 was admitted into evidence. The

Depart ment presented no witnesses. The Department's Exhibits I

through VI were admitted into evidence.

The T ranscript of the hearing was filed with DOAH , and the

parties timely filed post - hearing submittals , which have been

carefully considered in the preparati on of this Recommended

Order.

FINDINGS OF FACT

1. Petitioner was issued a Florida license as a "general

lines" insurance agent in 1980. He started a business named

Atlas Auto Insurance, Inc., in that same year. He sold Atlas

Auto Insurance in 1990. He started Budget Insurance Center,

Inc., in 1995 and sold that business in 1997.

2. On August 2, 1994, a Final Judgment was issued in the

Circuit Court for Leon County, Florida , in favor of the

Department of Insurance, as Receiver of insolvent American Risk

Assurance Company and National United Insurance Company, against

Petitioner and Atlas Auto Insurance for failure to return

unearned commissions of $1,138.96, plus interest and attorney's

fees.

3. On April 7, 1995, a Final Judgment was issued in the

Circu it Court for Leon County, Florida , in favor of the

Department of Insurance, as Receiver of insolvent Great Oaks

Insurance Company, against Petitioner and Atlas Auto Insurance

for failure to return unearned commissions of $259.95, plus

interest and attorney 's fees.

4. On August 12, 1996, a Final Judgment was issued in the

Circuit Court for Leon County, Florida , in favor of the

Department of Insurance, as Receiver of insolvent General

Insurance Company, against Petitioner and Budget Insurance

Center for fail ure to return unearned commissions of $1,718.14,

plus interest and attorney's fees.

5. Based on Petitioner's failure to satisfy the Final

Judgment in the General Insurance Company case, the Department

of Insurance initiated an administrative proceeding to revoke

Petitioner's license. On March 3, 1999, following a formal

hearing at DOAH which Petitioner did not attend (DOAH Case

No. 98 - 3776) , the Department of Insurance revoked Petitioner ' s

license.

6. On August 29, 1996, two final judgments were issued in

the Circuit Court for Leon County, Florida , in favor of the

Department of Insurance, as Receiver of insolvent International

Bankers Insurance Company, against Petitioner and Atlas Auto

Insurance for failure to return unearned commissions of

$6,914.90 an d $1,579.31, plus interest and attorney's fees.

7. On June 7, 2000, a Final Judgment was issued in the

Circuit Court for Leon County, Florida , in favor of the

Department of Insurance, as Receiver of insolvent Armor

Insurance Company, against Petitioner an d Budget Insurance

Center for failure to return unearned commissions of $3,446.65,

plus interest and attorney's fees.

8. Petitioner has never made a payment on any of the six

judgments against him.

9. Petitioner insists that he received no notice of the

civil actions cited above, or the final judgments that resulted.

Petitioner learned about the 1996 Final Judgment regarding

General Insurance Company when the administrative revocation

case was initiated by the Department of Insurance, because that

partic ular final judgment and Petitioner's failure to satisfy

the judgment w ere the bas e s for the revocation action.

According to Petitioner, he first learned about the other five

cases in May 2005, when the Department informed him about them

during the process ing of his license application.

10. Petitioner also stated that, except for the General

Insurance Company case, he was no longer associated with the

insurance companies involved in these civil cases and was not

personally responsible for any of the unearn ed commissions.

11. Each of the six final judgments of the Leon County

Circuit Court indicated that a copy was sent to Petitioner.

However, no address for Petitioner is stated. Each judgment is

against an insurance company , as well as Petitioner, but th e

"cc" only lists the Department of Insurance attorney and Stephen

Peter Alicino. 1 That suggests the final judgments, and perhaps

all notices, were sent to one address for both the insurance

company and Petitioner. It is possible that all correspondence

regarding the civil cases was sent to the businesses where

Petitioner no longer maintained an office or was otherwise

associated. It is also possible that the new owners of the

businesses never informed Petitioner about the cases.

12. Petitioner stated t hat when he was notified of other

judgments resulting from the insolvency of insurance companies,

he always paid those judgments. Petitioner has never had a

civil action brought against him except in the context of

insolvent insurer cases.

13. The only e vidence in the record regarding whether

Petitioner received actual notice of the civil cases and their

final judgments is the testimony of Petitioner and the "cc" on

the final judgments. The more persuasive evidence, taking into

account the demeanor of Pe titioner during his testimony, is that

he did not receive actual notice of the six civil cases and

their final judgments. 2

14. Petitioner filed an application for licensure as a

resident personal lines insurance agent on or about May 24,

2004. In respons e to the question on the application about

whether the applicant ever had a judgment against him in a civil

action related to insurance, Petitioner answered "No."

15. In response to the question on the application about

whether the applicant has ever had his license revoked,

Petitioner answered "Yes" and provided the Department of

Insurance case number.

16. The Department told Petitioner it would not process

his application for licensure until the outstanding judgments

were paid or a plan to satisfy the j udgments was established.

In three separate responses, Petitioner told the Department that

he was not liable for the unearned commissions and should not

have to pay them.

17. Petitioner stated that he has had illnesses, financial

problems, and family iss ues that have prevented him from making

any payments to date on the one judgment that he acknowledges

responsibility for, the 1996 Final Judgment regarding General

Insurance Company.

18. In his post - hearing submittal, Petitioner continues to

urge that the judgments against him, except for the Final

Judgment in the General Insurance Company case, be treated as

erroneous and that he be granted a license upon his satisfaction

of the General Insurance Company judgment.

CONCLUSIONS OF LAW

19. DOAH has jurisdi ction over the parties to and the

subject matter of these proceedings pursuant to Subsections

120.569(1) and 120.57(1), Florida Statutes (2005). 3

20. The Department is the state agency charged with the

responsibility of regulating the licensing of insur ance agents

pursuant to Chapter 626, Florida Statutes.

21. As the applicant for a license, Petitioner bears the

burden of proof in this case to establish he is entitled to the

license. Florida Department of Transportation v. J.W.C. Co.

Inc. , 396 So. 2d 7 78 (Fla. 1 st DCA 1981).

22. Section 626.611, Florida Statutes, provides in

pertinent part:

The department shall deny an application for,

suspend, revoke, or refuse to renew or

continue the license or appointment of any

applicant, agent, title agency, adj uster,

customer representative, service

representative, or managing general agent,

and it shall suspend or revoke the

eligibility to hold a license or appointment

of any such person, if it finds that as to

the applicant, licensee, or appointee any one

or m ore of the following applicable grounds

exist:

(1) Lack of one or more of the

qualifications for the license or appointment

as specified in this code.

(2) Material misstatement,

misrepresentation, or fraud in obtaining the

license or appointment or in attempting to

obtain the license or appointment.

* * *

(7) Demonstrated lack of fitness or

trustworthiness to engage in the business of

insurance.

23. Chapter 631, Florida Statutes, deals with the

procedures applicable when an insurance comp any is determined to

be insolvent, including the appointment of a receiver to manage

the insurer's assets and liabilities. Section 631.155 , Florida

Statutes, states that insurance agents have a duty to account to

the receiver for all premiums and unearned commissions

associated with the insolvent insurer and must pay sums

determined to be owed by the court within 30 days of judgment .

The section states further that, "failure to comply with this

section shall be sufficient grounds for the license revocatio n. "

24. The Department asserts that Petitioner's failure to

disclose the six final judgments on his application is evidence

of his lack of trustworthiness and fitness for licensure.

Although Petitioner answered "No" to the question about the

existence of any judgments against him in civil actions, he

informed the Department of the one judgment he was aware of at

the time of his application in his answer to a subsequent

question, by giving the case number for the final order in the

revocation proceeding. That final order indicated the

revocation was based on Petitioner's failure to satisfy the

Final Judgment in the General Insurance Company case.

Petitioner's lack of precision in answering these application

questions was not intended to mislead or deceive the Department

and is not evidence that Petitioner lacks trustworthiness or

fitness to be an insurance agent.

25. However, Petitioner failed to meet his burden of proof

to establish he is entitled to the license he seeks, because he

has not satisfied the judgments against him for unearned

commissions. Even assuming the correctness of Petitioner's

claim that he was never notified of the six civil actions and

was not responsible for the unearned commissions identified in

five of the judgments, he has yet t o satisfy the General

Insurance Company judgment which he admits responsibility for.

This is a sufficient basis, pursuant to Section 631.155 and

Subsections 626.611(1) and (7), Florida Statutes, for the

Department to deny Petitioner's application for a li cense.

26. In determining whether to issue Petitioner a license,

the Department may be able to consider Petitioner's claims that

he had no notice of the six insolvent insurer cases and that he

had no responsibility for the unearned commissions in five of

those cases because the commissions were paid long after he

ceased to be associated with the companies involved. However,

the undersigned has no authority in this licensing proceeding to

"rehear" the five civil cases that Petitioner disputes.

27. Moreove r, the record does not indicate that Petitioner

provided the Department sufficient information for it to accept

his claim that he was not responsible for the unearned

commissions. Therefore, the Department did not act unreasonably

in determining that all six judgments against Petitioner must be

paid, or a plan to pay them must be established, before it will

favorably consider Petitioner's application for licensure.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMME NDED that the Department of Financial Services

enter a f inal o rder denying Petitioner’s application for

licensure.

DONE AND ENTERED this 1 1 th day of July , 2006 , in

Tallahassee, Leon County, Florida.

S

BRAM D. E. CANTER

A dministrative 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.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 1 1 th day of July , 2006 .

ENDNOTES

1/ The same attorney appeared for the Department of Insurance

in all six cases.

2/ This finding is not intended to suggest that the final

judgments are invalid or unenforceable. It is r elevant only to

the issue of whether Petitioner's failure to satisfy the

judgments is evidence of lack of trustworthiness or fitness to

be an insurance agent.

3/ Unless otherwise indicated, all references to the Florida

Statutes are to the 2005 codificat ion.

COPIES FURNISHED :

Stephen Peter Alicino

434 Polk Avenue

Cape Canaveral, Florida 32920

Dickson E. Kesler, Esquire

Department of Financial Services

Suite S - 823, Hurston Building

400 West Robinson Street

Orlando, Florida 32801

Honorable Tom Galla gher

Chief Financial Officer

Department of Financial Services

The Capitol, Plaza Level 11

Tallahassee, Florida 32399 - 0300

Carlos G. Muniz, General Counsel

Department of Financial Services

The Capitol, Plaza Level 11

Tallahassee, Florida 32399 - 0300

NOT ICE 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.