08-005456PL Department Of Business And Professional Regulation, Construction Industry Licensing Board vs. Richard H. Lindley D/B/A Hcl, Inc. Status: Closed Recommended Order on Thursday, March 12, 2009.

Summary: Respondent is guilty of abandonment of a project and committing incompetency or misconduct in the practice of contracting. Respondent failed to complete the re-roofing project.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

CONSTRUCTION INDUSTRY LICENSING )

BOARD, )

)

Petitioner, )

)

vs. ) Case No. 08-5456PL

)

RICHARD H. LINDLEY d/b/a HCL, INC., )

)

)

Respondent. )

)

RECOMMENDED ORDER

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

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

Division of Administrative Hearings, on January 7, 2009, by

video teleconference at sites in West Palm Beach and

Tallahassee, Florida.

APPEARANCES

For Petitioner: Kyle Christopher

Lisa Comingore

Assistants General Counsel

Department of Business and

Professional Regulation

1940 North Monroe Street

Tallahassee, Florida 32399

For Respondent: Richard Lindley, pro se

Richard H. Lindley, d/b/a HCL, Inc.

9146 Arrowhead Drive

Greenacres, Florida 33467-1060

STATEMENT OF THE ISSUES

The issues in this case are whether Respondent, Richard

Lindley, committed the offenses alleged in a four-count

Administrative Complaint filed with Petitioner, the Department

of Business and Professional Regulation, on March 20, 2008, and,

if so, what penalty should be imposed.

PRELIMINARY STATEMENT

On March 20, 2008, Petitioner issued a four-count

Administrative Complaint in DBPR Case No. 2007-018062, alleging

that Respondent had violated certain statutory provisions

governing the conduct of individuals in Florida licensed by the

Construction Industry Licensing Board. In particular, it is

alleged in the Administrative Complaint that Respondent violated

Section 489.129(1)(g)2., Florida Statutes, by “committing

mismanagement or misconduct in the practice of contracting that

caused financial harm to a customer” (Count I); Section

489.129(1)(j), Florida Statutes, “by abandoning a construction

project in which the contractor is engaged or under contract as

a contractor” (Count II); Section 489.129(1)(o), Florida

Statutes, “by proceeding on any job without obtaining applicable

local building department permits and inspections” (Count III);

and Section 489.129(1)(m), Florida Statutes, “by committing

incompetency or misconduct in the practice of contracting”

(Count IV).

Respondent, by executing an Election of Rights form,

disputed the factual allegations of the Administrative Complaint

and requested “a hearing before an administrative law judge

before the Division of Administrative Hearings” pursuant to

Section 120.57(1), Florida Statutes (2008).

A copy of the Administrative Complaint and Election of

Rights form were filed with the Division of Administrative

Hearings on October 31, 2008. The matter was designated DOAH

Case No. 08-5456PL and was assigned to the undersigned.

The final hearing was scheduled for January 7, 2009, by

Notice of Hearing by Video Teleconference entered November 14,

2008.

At the final hearing, Petitioner presented the testimony of

Myra Love and James Brown. Petitioner also had 11 exhibits,

marked Petitioner’s Exhibits A through K, admitted. Respondent

testified on his own behalf and had two exhibits, marked

Respondent’s Exhibits 1 and 2, admitted.

On January 28, 2009, a Notice of Filing Transcript was

issued informing the parties that the one-volume Transcript of

the final hearing had been filed. The parties were also

informed that their proposed recommended orders were to be filed

on or before February 9, 2009.

Petitioner filed Petitioner’s Proposed Recommended Order on

February 6, 2009. Respondent filed a Proposed Recommended Order

on February 9, 2009. Both proposed recommended orders have been

fully considered in preparing this Recommended Order.

All references to the Florida Statutes in this Recommended

Order are to the codification applicable to the years in which

the events alleged in the Administrative Complaint took place,

2005 and 2006, unless otherwise noted.

FINDINGS OF FACT

1. Petitioner, the Department of Business and Professional

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

agency of the State of Florida charged with the responsibility

for, among other things, the licensure of individuals who wish

to engage in contracting in the State of Florida; and the

investigation and prosecution of complaints against individuals

who have been so licensed. See Chs. 455 and 489, Fla. Stat.

2. Respondent, Richard Lindley, is and has been at all

times material hereto a certified building contractor in

Florida, having been issued license number CB C060555.

Mr. Lindley is also a Certified Roofing Contractor, having been

issued license number CC C1326286. Both licenses were issued by

the Construction Industry Licensing Board (hereinafter referred

to as the “Board).

3. At all times material, Mr. Lindley was the primary

qualifying agent for HCL, Inc. (hereinafter referred to as

“HCL”). HCL has a certificate of authority, QB number 20599.

4. On or about June 8, 2005, Mr. Lindley, doing business

as HCL, entered into a written contract (hereinafter referred to

as the “Contract”) with Myra Love to re-roof her residence

located at 765 Windermere Way, Palm Beach Gardens, Florida 33418

(hereinafter referred to as the “Subject Property”).

5. Pursuant to the Contract, Ms. Love agreed to pay HCL a

total of $8,125.00, as follows: $1,625.00 upon signing the

Contract; $2,843.75 upon “roof dri in”; $2,843.75 upon “roof

load”; and $812.50 upon “final inspection.”

6. Consistent with the Contract, Ms. Love paid HCL

$1,625.00 by check dated June 8, 2005, upon entering into the

Contract.

7. On June 9, 2005, Mr. Lindley applied for a building

permit for the work to be performed pursuant to the Contract.

The permit was issued, but expired for lack of final inspection.

8. Ms. Love next paid HCL $2,843.75 by check dated

October 20, 2005, upon being informed that the roof had been

dried in. Despite having paid for the dry in of the roof, it

continued to leak.

9. After making the second payment to HCL in October 2005,

no work was performed pursuant to the Contract and all efforts

by Ms. Love to contact Mr. Lindley failed.

10. On April 24, 2006, Ms. Love wrote to Mr. Lindley

complaining about the condition of her roof and his lack of

response to her telephone calls to him. This letter was

delivered by certified mail, return receipt. Mr. Lindley did

not respond to Ms. Love’s April 24, 2006, letter.

11. No work was performed by Mr. Lindley through October

2006 on the Subject Property, at least a year after work on the

Subject Property stopped. Therefore, Ms. Love sent a letter

dated October 31, 2006, by certified mail, return receipt, to

Mr. Lindley. Ms. Love stated in the letter that “since you

abandoned the contract on 6/8/05, and failed to show up on the

job, I consider the contract null and void because of your

nonperformance. You and your employees are hereby notified to

stay off my property.”

12. On November 4, 2006, after informing Mr. Lindley that

she considered the Contract null and void, Ms. Love contracted

with Gold Coast Roofing to complete the re-roofing of the

Subject Property.

13. Ms. Love paid Gold Coast Roofing $14,900.00 for the

completion of the re-roofing. Essentially, Gold Coast Roofing,

due to the time that had expired since work was abandoned, had

to essentially start over on the re-roofing of the Subject

Property.

14. The total investigative costs for this matter incurred

by the Department, excluding costs associated with any

attorney’s time, was $258.56.

CONCLUSIONS OF LAW

A. Jurisdiction .

15. The Division of Administrative Hearings has

jurisdiction over the subject matter of this proceeding and of

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

Florida Statutes (2008).

B. The Burden and Standard of Proof .

16. The Department seeks to impose penalties against

Mr. Lindley through the Administrative Complaint that include

the suspension or revocation of his licenses. Therefore, the

Department has the burden of proving the specific allegations of

fact that support its charges by clear and convincing evidence.

See Department of Banking and Finance, Division of Securities

and Investor Protection v. Osborne Stern and Co. , 670 So. 2d 932

(Fla. 1996); Ferris v. Turlington , 510 So. 2d 292 (Fla. 1987);

and Pou v. Department of Insurance and Treasurer , 707 So. 2d 941

(Fla. 3d DCA 1998).

17. What constitutes "clear and convincing" evidence was

described by the court in Evans Packing Co. v. Department of

Agriculture and Consumer Services , 550 So. 2d 112, 116, n. 5

(Fla. 1st DCA 1989), as follows:

. . . [C]lear 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 evidence 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

the firm belief or conviction, without

hesitancy, as to the truth of the

allegations sought to be established.

Slomowitz v. Walker , 429 So. 2d 797, 800

(Fla. 4th DCA 1983).

See also In re Graziano , 696 So. 2d 744 (Fla. 1997); In re

Davey , 645 So. 2d 398 (Fla. 1994); and Walker v. Florida

Department of Business and Professional Regulation , 705 So. 2d

652 (Fla. 5th DCA 1998)(Sharp, J., dissenting).

C. The Charges of the Administrative Complaint .

18. Section 489.129, Florida Statutes, provides that

disciplinary action may be taken against a certificateholder,

registrant, or licensee if it is found that the individual has

committed certain enumerated offenses.

19. In this matter, it has been alleged that Respondent

committed the offenses described in Section 489.129(1)(g)2., (j)

(m) and (o), Florida Statutes:

(1) The board may take any of the

following actions against any

certificateholder or registrant: place on

probation or reprimand the licensee, revoke,

suspend, or deny the issuance or renewal of

the certificate, registration, or

certificate of authority, require financial

restitution to a consumer for financial harm

directly related to a violation of a

provision of this part, impose an

administrative fine not to exceed $10,000

per violation, require continuing education,

or assess costs associated with

investigation and prosecution, if the

contractor, financially responsible officer,

or business organization for which the

contractor is a primary qualifying agent, a

financially responsible officer, or a

secondary qualifying agent responsible under

s. 489.1195 is found guilty of any of the

following acts:

. . . .

(g) Committing mismanagement or

misconduct in the practice of contracting

that causes financial harm to a customer.

Financial mismanagement or misconduct occurs

when:

. . . .

2. The contractor has abandoned a

customer's job and the percentage of

completion is less than the percentage of

the total contract price paid to the

contractor as of the time of abandonment,

unless the contractor is entitled to retain

such funds under the terms of the contract

or refunds the excess funds within 30 days

after the date the job is abandoned; or

. . . .

(j) Abandoning a construction project in

which the contractor is engaged or under

contract as a contractor. A project may be

presumed abandoned after 90 days if the

contractor terminates the project without

just cause or without proper notification to

the owner, including the reason for

termination, or fails to perform work

without just cause for 90 consecutive days.

. . . .

(m) Committing incompetency or misconduct

in the practice of contracting.

(o) Proceeding on any job without

obtaining applicable local building

department permits and inspections.

20. Because of their penal nature, the foregoing statutory

provisions must be strictly construed, with any reasonable

doubts as to their meaning being resolved in favor of the

certificateholder or registrant. See Jonas v. Florida

Department of Business and Professional Regulation , 746 So. 2d

1261, 1262 (Fla. 3d DCA 2000)("[S]tatutes such as those at issue

authorizing the imposition of discipline upon licensed

contractors are in the nature of penal statutes, which should be

strictly construed."); and Capital National Financial

Corporation v. Department of Insurance , 690 So. 2d 1335, 1337

(Fla. 3d DCA 1997)("Section 627.8405 is a penal statute and

therefore must be strictly construed: . . . . 'When a statute

imposes a penalty, any doubt as to its meaning must be resolved

in favor of a strict construction so that those covered by the

statute have clear notice of what conduct the statute

proscribes.'").

21. As the primary qualifying agent for HCL, Mr. Lindley

is jointly and equally responsible for all business operations

of Alpha. See § 489.1195(1)(a), Fla. Stat.

D. Counts I, and II; Sections 489.129(1)(g)2., and (j),

Florida Statutes .

22. The violations alleged in Counts I and II essentially

turn on the issue of whether HCL abandoned the construction

project it agreed to carry out on the Subject Property for

Ms. Love. Whether Mr. Lindley is also guilty of the violation

alleged in Count IV also depends, at least in part, on whether

HCL abandoned the construction project.

23. First, Count I alleges that Mr. Lindley violated

Section 489.129(1)(g)2., Florida Statutes, by committing

mismanagement or misconduct in the practice of contracting that

caused financial harm to a customer. Financial mismanagement or

misconduct are specifically defined to include the abandonment

of a job when the percentage of the job completed is less than

the percentage of the contract price paid, “unless the

contractor is entitled to retain such funds under the terms of

the contract or refunds the excess funds within 30 days after

the date the job is abandoned.”

24. Count II alleges that Mr. Lindley violated Section

project in which the contractor is engaged or under contract as

a contractor.” This provision goes on to provided that “[a]

project may be presumed abandoned after 90 days if the

contractor terminates the project without just cause or without

proper notification to the owner, including the reason for

termination, or fails to perform work without just cause for 90

consecutive days .” (Emphasis added).

25. The facts proved clearly and convincingly that no work

was performed on the Subject Property between October 2005 and

October 2006. Clearly, Mr. Lindley abandoned the project

without “just cause” to do so.

26. The evidence failed to prove, however, that the

percentage of the job that had been completed when he abandoned

the project was less than the percentage of the contract price

paid. The evidence did prove that the total amount paid by

Ms. Love of $4,468.75, was 55% of the total Contract price, but

the Department failed to present sufficient evidence to prove

that less than 55% of the Contract had been completed at the

time of abandonment. While there was testimony that the roof

continued to leak after “dry-in,” there was no other evidence

presented from which it can be determined what percentage of the

job dry-in constituted, what other work had been done, if any,

and the extent to which dry-in was not successful.

27. Based upon the foregoing, it is concluded that the

evidence failed to prove clearly and convincingly that Mr.

Lindley is in violation of Section 489.129(1)(g)2., Florida

Statutes, as alleged in Count I of the Administrative Complaint.

28. The evidence did, however, prove clearly and

convincingly that Mr. Lindley is in violation of Section

489.129(1)(j), Florida Statutes, because he abandoned the

project for in excess of 90 days.

E. Count III; Section 489.129(1)(o), Florida Statutes .

29. The Department did not prove that Mr. Lindley

performed any work on the Subject Property prior to obtaining a

permit. While Mr. Lindley failed to obtain a final inspection

on the permit he obtained for the Subject Property, no evidence

as presented to prove that he did any work on the project when

inspections were required. He cannot, therefore, be said to

have “proceeded” in any way on the job without obtaining any

inspections.

30. The Department has, therefore, failed to prove clearly

and convincingly that Mr. Lindley violated Section

489.129(1)(o), Florida Statutes.

F. Count IV; Section 489.129(1)(m), Florida Statutes .

31. Finally, Count IV alleges that Mr. Lindley committed

“incompetency or misconduct in the practice of contracting” in

violation of Section 489.129(1)(m), Florida Statutes.

32. Florida Administrative Code Rule 61G4-17.001(1)(m)2.

provides that misconduct or incompetency in the practice of

contracting includes the violation of any provision of Chapter

489, Part I, Florida Statutes. Thus, by having violated Section

489.129(1)(j), Florida Statutes, Mr. Lindley is technically

guilty of misconduct or incompetency in his practice of

contracting.

33. It having been found that Mr. Lindley has committed

the violation alleged in Count II of the Administrative

Complaint, Mr. Lindley is in violation of Section 489.129(1)(m),

Florida Statutes, as alleged in Count IV.

G. The Appropriate Penalty .

34. The only issue remaining for consideration is the

appropriate disciplinary action which should be taken against

Mr. Lindley for the violations that were proven by the

Department. To answer this question it is necessary to consult

the "disciplinary guidelines" of the Board. Those guidelines

are set forth in Florida Administrative Code Chapter 61G4-17,

and they effectively place restrictions and limitations on the

exercise of the Board’s disciplinary authority . See Parrot

Heads, Inc. v. Department of Business and Professional

Regulation , 741 So. 2d 1231, 1233 (Fla. 5th DCA 1999)("An

administrative agency is bound by its own rules . . . creat[ing]

guidelines for disciplinary penalties."); and § 455.2273(5),

Fla. Stat. ("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.”).

35. In Florida Administrative Code Rule 61G4-17.001, the

Board has announced the "Normal Penalty Ranges" within which its

disciplinary action against contractors will fall, absent

aggravating or mitigating circumstances, for specified

violations.

36. Violations of Section 489.129(1)(j), Florida Statutes,

the violations proved in this case, are specifically addressed

in Subsection (1) of Florida Administrative Code Rule 61G4-

17.001, which provides the "Normal Penalty Ranges" for such this

violation is a “$2,500 fine and/or probation or suspension.”

Fla. Admin. Code R. 61G4-17.001(1)(j). The range for a

violation of Section 489.129(1)(m), Florida Statutes, is a

“$1,000 fine and/or probation or suspension.”

37. Florida Administrative Code Rule 61G4-17.002 lists

"Aggravating and Mitigating circumstances" to be considered in

determining whether a departure from the "Normal Penalty Range"

is warranted in a particular case. These aggravating and

mitigating circumstances include the following:

(1) Monetary or other damage to the

licensee's customer, in any way associated

with the violation, which damage the

licensee has not relieved, as of the time

the penalty is to be assessed. (This

provision shall not be given effect to the

extent it would contravene federal

bankruptcy law.)

(2) Actual job-site violations of

building codes, or conditions exhibiting

gross negligence, incompetence, or

misconduct by the licensee, which have not

been corrected as of the time the penalty is

being assessed.

(3) The danger to the public.

(4) The number of complaints filed

against the licensee.

(5) The length of time the licensee has

practiced.

(6) The actual damage, physical or

otherwise, to the licensee's customer.

(7) The deterrent effect of the penalty

imposed.

(8) The effect of the penalty upon the

licensee's livelihood.

(9) Any efforts at rehabilitation.

(10) Any other mitigating or aggravating

circumstances.

38. The Department has suggested that Mr. Lindley be

placed on probation for two years, required to pay a fine of

$2,500.00, and make restitution in the amount of $4,468.75 to

Ms. Love for the violation of Section 489.129(1)(g)2., Florida

Statutes; be placed on probation for an additional two years and

be required to pay a fine of $5,000.00 for the violation of

Section 489.129(1)(j), Florida Statutes; and be required to pay

a fine of $2,500.00 for the violation of Section 489.129(1)(m),

Florida Statutes.

39. Based upon all the facts of this case, it is concluded

that the top of the penalty range for the various violations for

a first offense is appropriate. Additionally, it is concluded

that imposing any fine for the violation of Section

489.129(1)(m), Florida Statutes, ignores the fact that the

violation is a technical one, predicated solely upon the other

two violations. To impose a fine for this violation, would,

therefore, punish Mr. Lindley twice for the same act.

40. In addition to any penalty imposed upon Mr. Lindley,

Florida Administrative Code Rule 61G4-17.001(5) provides that

“ the board shall order the contractor to make restitution in the

amount of financial loss suffered by the consumer to the extent

that such order does not contravene federal bankruptcy law.”

Given the fact that Ms. Love was required to pay in excess of

the original Contract price to complete the project, the

evidence has proved that Mr. Lindley caused a loss to her of the

amount paid to him under the Contract: $4,468.75.

41. Finally Florida Administrative Code Rule 61G4-

17.001(4) provides that, in addition to any other disciplinary

action it may impose, the Board will also "assess the costs of

investigation and prosecution, excluding costs related to

attorney time." That amount is $258.56 in this case.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that a final order be entered:

1. Finding that Richard Lindley violated the provisions of

Section 489.129(1)(j) and (m), Florida Statutes, as alleged in

Counts II and IV of the Administrative Complaint; imposing a

fine of $2,500.00 and placing Mr. Lindley’s licenses on

probation for a period of four years conditioned upon his

payment of the fines, restitution and the costs incurred by the

Department, and any other conditions determined to be necessary

by the Board, for the Count II violation; requiring that

Mr. Lindley make restitution in the amount of $4,468.75 to

Ms. Love; and requiring that Mr. Lindley pay the costs incurred

by the Department in investigating and prosecuting this matter;

and

2. Dismissing Counts I and III of the Administrative

Complaint.

DONE AND ENTERED this 12th day of March, 2009, in

Tallahassee, Leon County, Florida.

___________________________________

LARRY J. SARTIN

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 12th day of March, 2009.

COPIES FURNISHED:

Lisa A. Comingore, Esquire

Department of Business and

Professional Regulation

1940 North Monroe Street, Suite 42

Tallahassee, Florida 32399-2202

Richard H. Lindley

Richard H. Lindley, d/b/a HCL, Inc.

9146 Arrowhead Drive

Greenacres, Florida 33467-1060

Kyle Christopher, Esquire

Department of Business &

Professional Regulation

1940 North Monroe Street, Suite 42

Tallahassee, Florida 32399-2202

G. W. Harrell, Executive Director

Construction Industry Licensing Board

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399-0792

Ned Luczynski, General Counsel

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399-0792

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.