10-009444 Robert Petito vs. Construction Industry Licensing Board Status: Closed Recommended Order on Friday, July 1, 2011.

Summary: Agency lacked authority to impose disciplinary conditions on approval of license.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ROBERT PETITO , )

)

Petitioner , )

)

vs. ) Case No. 10 - 9444

)

CONSTRUCTION INDUSTRY LICENSING )

BOARD , )

)

Respondent . )

)

RECOMMENDED ORDER

On May 26, 2011, a formal administrative hearing was

conducted by video tele conference between Orlando and

Tallahassee, Florida, before William F. Quattlebaum,

Administrative Law Judge, Divisi on of Administrative Hearings.

APPEARANCES

For Petitioner: Rosemary Hanna Hayes, Esquire

Hayes & Caraballo

830 Lucerne Terrace

Orlando, Flo rida 32801

For Respondent: Daniel R. Biggins, Esquire

Department of Legal Affairs

The Capitol, Plaza Level 01

Tallahassee, Florida 32399 - 1050

STATEMENT OF THE ISSUE

The issue in th is case is whether the Construction Industry

Licensing Board (Respondent) should approve the application of

Robert Petito (Petitioner) to transfer his certified Class B air

conditioning license, issued in 2007, from one business entity

to another.

PRELIMIN ARY STATEMENT

By Notice of Intent to Approve w ith Conditions (Notice)

dated November 6, 2009, the Respondent notified the Petitioner

that his application for a "change of status from one business

entity to another contractor's license" was being approved with

conditions. The Petitioner requested an administrative hearing

to challenge the approval with conditions. On October 5, 2010,

the Respondent forwarded the request to the Division of

Administrative Hearings, which scheduled the hearing to commence

on January 5, 2011 , in accord with the parties' dates of

availability. The hearing was continued once , at the request of

the Petitioner, and was the reafter heard on May 26, 2011.

At the hearing, the Petitioner presented the testimony of

one witness, testifi ed on his own behalf, and had E xhibits 1A,

1B, 2A, 2B, 8, 9, 10 , and 11 admitted into evidence. The

Respondent presented no testimony or exhibits.

No transcript of the hearing was filed. Both parties filed

Proposed Recommended Orders that have been consi dered in the

prepara tion of this Recommended Order.

FINDINGS OF FACT

1. The Petitioner was issued a certified Class B air

conditioning lice nse by the Respondent in 2007.

2. At the time of the 2007 application for licensure, the

Petitioner acknowledged a criminal history on the application.

In an attachment to the 2007 application, the Petitioner stated

that the referenced offense was "Drugs and Robbery" and offered

the following explanation:

25 years ago when I was younger I got caught

up in a lot of thi ngs, but my rights have

been restored and I have been in no trouble

since.

3. Also attached to the application was a certificate

dated October 16, 2003, stating that the Petitioner's civil

rights had been restored on February 2, 1984.

4. According to the transcript of the b oard meeting at

which the 2007 application was granted, the Respondent approved

the Petitioner's application for licensure with little

discussion of significance as to the Petitioner's criminal

history.

5. In 2009, the Petitioner fi led an application to

transfer his license from one business entity to another. The

Petitioner again acknowledged a criminal history on the

application, through an affirmative response to this question on

the application form:

Have you ever been convict ed of a crime,

found guilty, or entered a plea of guilty or

nolo contendere (no contest) to a crime,

even if you received a withhold of

adjudication? This question applies to any

violation of the laws of any municipality,

county, state or nation, includin g felony,

misdemeanor and traffic offenses (but not

parking, speeding, inspection, or traffic

signal violations) without regard to whether

you were placed on probation, had

adjudication withheld, were paroled, or

pardoned. . . . YOUR ANSWER TO THIS

QUESTION WILL BE CHECKED AGAINST LOCAL,

STATE AND FEDERAL RECORDS. FAILURE TO

ANSWER THIS QUESTION ACURATELY MAY RESULT IN

THE DENIAL OR REVOCATION OF YOUR LICENSE.

IF YOU DO NOT FULLY UNDERSTAND THIS

QUESTION, CONSULT WITH AN ATTOR NEY OR

CONTACT THE DEP ARTMENT.

6. The application form required that an applicant

responding affirmatively to the referenced question provide

additional information regarding the response. In an attachment

to the transfer application, the Petitioner offered the

following explanation:

In the late 1970's I was convicted on drug &

robbery related charges. Please find

enclosed a copy of the Certificate of

Restoration of Civil Rights.

7. The Respondent conducted a background investigation as

part of the transfer applicatio n review. The investigation

revealed that the Petitioner's criminal history was other than

had been indicated by the Petitioner's explanation. The

criminal record indicated that the felony drug and robbery

convictions occurred in 1981 and that the Petiti oner had been

convicted of trespassing in 1996 and of ba ttery and trespassing

in 2003.

8. In the Notice dated November 6, 2009, the Respondent

notified the Petitioner that the transfer was b eing approved

with conditions.

9. According to the Notice, the conditions constituted the

imposition of discipline against the Petitioner's license,

including a suspension of the Petitioner's license that was

stayed during a six - year period of probation. In relevant part,

the Notice stated as follows:

NOTICE OF INTE NT TO APPROVE WITH CONDITIONS

You are hereby notified that the

Construction Industry Licensing Board

(Board) voted to permit, WITH CONDITIONS,

your application for change of status from

one business entity to another contractor's

license.

The Board revie wed and considered the

application at a duly - noticed public meeting

held on September 10, 2009 in Tampa Florida.

The Board determined that the application

should be approved with conditions based on

the following:

1. The applicant failed to sufficiently

demonstrate financial stability and

responsibility, pursuant to section 489.115,

Florida Statutes and Rule 61G4 - 15.005,

Florida Administrative Code.

2. The Board had issues with applicant's

moral character, pursuant to section

489.111, Florida Statutes.

3. Pursuant to section 455.227(2)(f),

Florida Statutes, Applicant shall hereby be

placed on PROBATION for 6 years , with

12 satisfactory appearances, according to

the following terms:

A) Applicant shall be required to appear

before the Probation Committee of the Board

at such times as directed by the Board

Office, approximately every six (6) months.

Respondent's first probationary appearance

requires a full day attendance at the Board

meeting. In connection with each probation

appearance, Applic ant shall answer questions

under oath. In addition, applicant shall

provide such other information or

documentation as is requested by either the

Department, the Board, or the Probation

Committee. Applicant shall forward said

documentation to the Board a t least 30 days

in advance of the probation appear ance or as

otherwise directed.

B) The burden shall be solely upon

Applicant to remember the requirement for

said appearance and to take necessary steps

in advance of said appearance to contact the

Board o ffice and ascertain the specific

time, date, and place of said appearance.

Applicant shall not rely on getting notice

of said appearance from the Board or the

Department.

C) Should Applicant violate any condition

of the probation, it shall be consider ed a

violation of Section 489.129(1)(i), Florida

Statutes, and shall result in further

disciplinary action by the Board .

D) Should Applicant fail to make a

satisfactory appearance as determined by the

Board, the term of the probationary period

shall be a utomatically extended by six (6)

months. If there occurs a second such

failure then the term of the probationary

period will be extended an additional year.

Should the Board determine a third failure

of Applicant to make a satisfactory

appearance, the st ay of suspension of the

Applicant's license to practice contracting

shall be lifted and the license shall remain

in suspended status unless and until a

further stay is granted by the Board .

E) Should Applicant's license to practice

contracting be suspend ed or otherwise placed

on inactive status, the probation period

shall be tolled and shall resume running at

the time Applicant reactivates the license,

and Applicant shall serve the time remaining

in the term of probation.

F) To ensure successful compl etion of

probation, Applicant's license to practice

contracting shall be suspended for the

period of probation, with the suspension

stayed for the period of probation . The

time of the suspension and the stay shall

run concurrently with the period of

proba tion. If Applicant successfully

completes probation, the suspension shall

terminate. If Applicant fails to comply

with the requirements set forth in the Final

Order imposed in this case, or fails to make

satisfactory appearances as determined by

the Boar d, the stay shall be lifted. Once

the stay is lifted, the license shall remain

in suspended status unless and until a

further stay is granted by the Board.

( e mphasis added ) .

10. Section 455.225, Florida Statutes (200 9 ) , 1/ sets forth

the process through which the Respondent may commence a

disciplinary proceeding against a licensee. There was no

evidence presented that the Respondent has commenced or

concluded a disciplinary proceeding against the Petitioner

pursuant to the cited statute. The Respondent presented no

evidence at the hearing.

11. At the time of the Petitioner's transfer application,

the Petitioner had a credit score of 590. At the hearing, the

Petitioner established , through submission of a credit report,

t hat he ha d a credit score in excess of 66 0 as determined by the

three relevant reporting agencies and that he had no pending

liens or judgments.

CONCLUSIONS OF LAW

12. The Division of Administrative Hearings has

jurisdiction over the parties to and subject matter of this

proceeding. §§ 120.569 & 120.57(1), Fla . Stat . (2010).

13. The issue presented in this case is whether the

Respondent should approve the application o f the Petitioner to

transfer his current license from one business entity to

another. The Petitioner has the burden of establishing by a

preponderance of the evidence that he is entitled to approval of

his transfer application. Balino v. Dep't of HRS , 34 8 So. 2d

349 (1st DCA 1977). Fla. Dep't of Transp. v. J.W.C. Co., Inc. ,

396 S o. 2d 778 (Fla. 1st DCA 1981).

14. Here, the Respondent has attempted to approve the

application while imposing disciplinary penalties on the

Petitioner's existing license. T he Respondent lacks statutory

authority to take such action in this case. Section 455.225

establishes the procedure through which the Respondent may

commence a disciplinary proceeding against a licensee. The

process requires an investigation, a determinati on of probable

cause, a formal filing of charges against a licensee, and an

administrative hearing at which the charging agency must

establish the truthfulness of the allegations by clear and

convincing evidence, if the licensee disputes the allegations.

None of that has occurred here.

15. In the Notice, the Respondent cited section

455.227(2)(f) as authorizing the imposition of the conditions to

the Petitioner's license. In relevant part, section 455.227

provides as follows:

Grounds for discipline; pena lties;

enforcement. --

(1) The following acts shall constitute

grounds for which the disciplinary actions

specified in subsection (2) may be taken :

(a) Making misleading, deceptive, or

fraudulent representations in or related to

the practice of the licenseeÓs profession.

(b) Intentionally violating any rule

adopted by the board or the department, as

appropriate.

(c) Being convicted or found guilty of, or

entering a plea of guilty or nolo contendere

to, regardless of adjudication, a crime in

any j urisdiction which relates to the

practice of, or the ability to practice, a

licenseeÓs profession.

* * *

(t) Failing to report in writing to the

board or, if there is no board, to the

department within 30 days after the licensee

is convicted or found guilty of, or entered

a plea of nolo contendere or guilty to,

regardless of adjudication, a crime in any

jurisdiction. A licensee must report a

conviction, finding of guilt, plea, or

adjudication entered before the effective

date of this paragraph w ithin 30 days after

the effective date of this paragraph.

* * *

(2) When the board, or the department when

there is no board, finds any person guilty

of the grounds set forth in subsection (1)

or of any grounds set forth in the

applicable practi ce act, including conduct

constituting a substantial violation of

subsection (1) or a violation of the

applicable practice act which occurred prior

to obtaining a license, it may enter an

order imposing one or more of the following

penalties :

* * *

(f) Placement of the licensee on probation

for a period of time and subject to such

conditions as the board, or the department

when there is no board, may specify. Those

conditions may include, but are not limited

to, requiring the licensee to undergo

treatment, attend continuing education

courses, submit to be reexamined, work under

the supervision of another licensee, or

satisfy any terms which are reasonably

tailored to the violations found.

16. The various penalties set forth in section 455.227(2)

are available only upon a formal determination pursuant to a

disciplinary proceeding under section 455.225 that one or more

of the provisions of section 455.227(1) has been violated.

Here, the Responde nt has not complied with the disciplinary

procedure set forth at section 455.225, has not formally charged

Petitioner with any violation of section 455.227(1), and may not

impose the penalties set forth in section 455.227(2).

17. In the Notice, the Respon dent stated that disciplinary

conditions were being imposed against the Petitioner in part

because the "Board had issues with applicant's moral character,

pursuant to Se ction 489.111, Florida Statutes , " which provides

in relevant part as follows:

Licensure by examination. --

(1) Any person who desires to be certified

shall apply to the department in writing.

(2) A person shall be eligible for

licensure by examination if the person:

(a) Is 18 years of age;

(b) Is of good moral character; and

(c) Mee ts eligibility requirements. . . .

* * *

(3)(a) The board may refuse to certify an

applicant for failure to satisfy the

requirement of good moral character only if:

1. There is a substantial connection

between the lack of good moral character of

the applicant and the professional

responsibilities of a certified contractor;

And

2. The finding by the board of lack of good

moral character is supported by clear and

co nvincing evidence .

(b) When an applicant is found to be

unqualified for a certificate because of a

lack of good moral character, the board

shall furnish the applicant a statement

containing the findings of the board, a

complete record of the evidence upon which

the determination was based, and a notice of

the rights of the applicant to a rehearing

and appeal . (emphasis added).

18. The Respondent's Notice does not state that the

Respondent foun d the Petitioner to be unqualified based on a

lack of good moral character. A stat ement that the Respondent

"had issues with the applicant's moral character" is

insufficient to comply with the requirements of section

489.111(3)(b) , Florida Statutes.

19. In the Notice, the Respondent also stated that the

Petitioner "failed to sufficiently demonstrate financial

stability and responsibility, pursuant to section 489.115,

Florida Statutes and Rule 61G4 - 15.006, Florida Administrative

Code." Section 489.115(7) provides in relevant part as follows:

An initial applicant shall, along w ith the

application, and a certificateholder or

registrant shall, upon requesting a change

of status, submit to the board a credit

report from a nationally recognized credit

agency that reflects the financial

responsibility of the applicant or

certificateh older or registrant . The credit

report required for the initial applicant

shall be considered the minimum evidence

necessary to satisfy the board that he or

she is financially responsible to be

certified, has the necessary credit and

business reputation t o engage in contracting

in the state, and has the minimum financial

stability necessary to avoid the problem of

financial mismanagement or misconduct. The

board shall, by rule, adopt guidelines for

determination of financial stability , which

may include m inimum requirements for net

worth, cash, and bonding for Division I

certificateholders of no more than $20,000

and for Division II certificateholders of no

more than $10,000. Fifty percent of the

financial requirements may be met by

completing a 14 - hour f inancial

responsibility course approved by the board.

(emphasis added).

20. Florida Administrative Code Rule 61G4 - 15.006 provides

as follows:

Financial Responsibility and Financial

Stability, Grounds for Denial.

(1) The financial responsibility ground on

which the Board shall refuse to qualify an

applicant is failure to provide a current

consumer credit report, as defined in Rule

61G4 - 12.011, F.A.C., which consumer credit

report does not disclose any unsatisfied

judgments or liens against the applicant .

In addition, there must not be any

unsatisfied judgments or liens against the

business entity which the applicant

previously qualified as a primary qualifier

or which the applicant has applied to

qualify.

(2) The financial stability ground on which

th e Board shall refuse to qualify an

applicant is failure to provide proof of

either a financial stability bond or an

irrevocable letter of credit from a bank

authorized to do business in the State of

Florida. The bond or letter of credit must

be in a form acceptable to the Board and

must remain in effect until the applicant

can demonstrate a credit score, FICO

derived, of 660 or higher, and must be

payable as provided in Rule 61G4 - 15.0021,

F.A.C., for Financially Responsible Officers

in the amount of:

(a) $20,000 for Division I applicants.

(b) $10,000 for Division II applicants.

(3) Fifty percent of the financial

stability bond or the letter of credit

requirement may be met by completion of a

14 - hour financial responsibility course

approved by the Boar d.

(4) An applicant may meet both the

financial responsibility and financial

stability requirements by providing proof of

a current consumer credit report, as defined

in Rule 61G4 - 12.011, F.A.C, with a credit

score , FICO derived, of 660 or higher , which

consumer credit report does not disclose any

unsatisfied judgments or liens against the

applicant. In addition, there must not be

any unsatisfied judgments or liens against

the business entity which the applicant

previously qualified as a primary qualifie r

or which the applicant has applied to

qualify. (emphasis added).

21. The evidence established that the Petitioner's most

recent credit report meets the requirements of section

489.115(7) and rule 61G4 - 15.006(4), and, therefore, the

Petitioner has sufficiently demonstrated financial stability and

responsibility.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Construction Industry Licensing

Board enter a f inal o rder granting the Petitioner's application

to transfer his license from o ne business entity to another.

DONE AND ENTERED this 1st day of Ju ly , 2011 , in

Tallahassee, Leon County, Florida.

S

WILLIAM F. QUATTLEBAUM

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 1st day of Ju ly , 2011 .

ENDNOTE

1/ References to Florida Statutes are to Florida Statutes

(2009), unless otherwise indictaed.

COPIES FURNISHED :

Daniel R. Biggins, Esquire

Department of Legal Affairs

The Capitol, Plaza Level 01

Tallahassee, Florida 32399 - 1050

Rosemary Hanna Hayes, Esquire

Hayes & Caraballo

830 Lucerne Terrace

Orlando, Florida 32801

Layne Smith, General Counsel

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399 - 0792

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

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.