10-010702 Department Of Revenue vs. Four Fran Corporation Status: Closed Recommended Order on Thursday, March 24, 2011.

Summary: Respondent's certificate of registration should be revoked for failing to remit sales and use taxes.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF REVENUE, )

)

Petitioner, )

)

vs. )

) Case No. 10 - 10702

FOUR F R AN CORPORATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to noti ce, a formal hearing was held in this case

on February 21, 2011, by video teleconference between West Palm

Beach and Tallahassee, Florida, before Administrative Law Judge

Claude B. Arrington of the Division of Administrative Hearings

(DOAH).

APPEARANCES

For Petitioner: Carrol Y. Cherry, Esquire

Office of the Attorney General

Revenue Litigation Bureau

The Capitol, P laza L evel 01

Tallahassee, Florida 32399

For Resp ondent: No appearance.

STATEMENT OF THE ISSUES

Whether Respondent committed the violations alleged in the

"Administrative Complaint for Revocation of Certificate of

Registration" (Administrative Complaint) filed with DOAH on

April 20, 2009, and, if so, the action that should be taken.

PRELIMINARY STATEMENT

The Department of Revenue (Petitioner) seeks to permanently

revoke the c ertificate of r egistration held by Four F r an

Corporation (Respondent) for failure to pay sales and use taxes

in the amounts and f or the periods set forth in the Findings of

Fact section of this Recommended Order.

Petitioner filed its Administrative Complaint against

Respondent on April 20, 2009, where it was assigned DOAH Case

No. 09 - 2124. On July 24, 2009, Petitioner filed its "Un opposed

Motion to Close the Division's File, Without Prejudice to Reopen

at a Later Date". On July 27, 2009, the undersigned granted the

motion and relinquished jurisdiction of the matter to

Petitioner. On December 16, 2010, the Petitioner filed its

"Mot ion to Reopen Division File", which the undersigned granted

the following day. Thereafter a Notice of Hearing by Video

Teleconference and a Prehearing Order were entered and mailed to

Petitioner's counsel and to Respondent's representative.

At the formal hearing, Petitioner presented the testimony

of Anthony Martino (an investigator employed by Petitioner), and

Erika Dummery (a Revenue Administrator II employed by

Petitioner). Petitioner offered 11 sequentially - numbered

exhibits, each of which was admitte d into evidence.

As reflected above, there was no appearance on behalf of

Respondent.

No transcript has been filed. Petitioner timely filed its

Proposed Recommended Order, which has been duly considered by

the undersigned in the preparation of this Recomm ended Order.

Respondent did not file a proposed recommended order.

Unless otherwise noted, all statutory references are to

Florida Statutes (2010).

FINDINGS OF FACT

1. Petitioner is the agency of the State of Florida

responsible for administering the re venue laws of the State of

Florida, including the imposition and collection of the state's

sales and use taxes pursuant to chapter 212, Florida Statutes.

2. Respondent is an active for - profit corporation with its

principal address at 8461 Lake Worth Road, #189, Lake Worth,

Florida. Respondent is a "dealer" as that term is defined by

section 212.06(2), and holds certificate of registration number

16 - 8014804285 - 5. Respondent operates a restaurant in Broward

County, Florida.

3. Respondent's Registered Agen t is Michael Letts, whose

address is 1166 North State Road #7, Lauderhill, Florida 33313.

WARRANT 1000000100712

4 . Petitioner audited Respondent for payment of sales and

use taxes for the period June 1, 2004 through May 31, 2007 .

Petitioner assigned the number 200031264 to that audit .

5 . As a result of a udit number 200031264, Petitioner

issued to Respondent a Notice of Proposed Assessment on May 28,

2008, that assessed Respondent $50,326.67 in tax; $7,549.01 in

penalty ; and $1 3,540.49 in interest as of M a y 28, 2008, for a

total of $71,416.17.

6. The assessment became final on July 28, 2008.

7. Petitioner issued tax warrant numbered 1000000100712 ,

and recorded the warrant in the public records of Broward

County, Florida, on November 24, 2008. The total of the

warrant, which included an updated interest amount and a $20.00

filing fee, was $73,483.72.

8. In terest continues to accrue until the tax is paid in

full. As of February 15, 2011, the total sum of $80,634.81

remained unpaid as a result of th e ass essment , the continued

accrual of interest thereon , and the cost of the filing fee . 1

RETURNS WITHOUT REMITTANCES

9. Respondent filed with Petitioner sales and use tax

returns without remitting the taxes due with the returns for the

months of August - Dece mber 2008 and January - February 2009.

Respondent failed to remit to Petitioner $6,953.36 in sales and

use taxes for those months. For that failure, Petitioner

assessed Respondent with taxes in the amount of $6,953.36; a

penalty in the amount of $505.98; interest as of March 17, 2009,

in the amount of $169.45, and a collection fee in the amount of

$80.00. That assessment, which totaled $7,708.79, remained

unpaid at the time of the formal hearing. In terest continues to

accrue until the tax is paid in ful l.

PROCEDURAL COMPLIANCE

10. Petitioner made efforts to negotiate a Compliance

Agreement with Respondent and met with a representative of the

Respondent . T hose efforts were unsuccessful.

11. Respondent has failed to remit payment for the tax,

penalty, i nterest, and fees due and owing to Petitioner pursuant

to chapter 212 .

12. Petitioner established that it complied with all

applicable procedural requirements prior to filing the

Administrative Complaint with DOAH.

CONCLUSIONS OF LAW

13 . DOAH has jurisd iction over the subject matter of and

the parties to this proceeding pursuant to sections 120.569 ,

120.57(1), and 212.18, Florida Statutes.

14 . Petitioner has the burden of proving by clear and

convincing evidence the allegations against Respondent. See

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

Co. v. Dep't of Agric. & Consumer Servs. , 550 So. 2d 112 (Fla.

1st DCA 1989); and Inquiry Concerning a Judge , 645 So. 2d 398

(Fla. 1994). The following statement has been repeatedly cited

in discussions of the clear and convincing evidence standard:

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 evidence

must be precise and expli cit 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 of (sic)

conviction, without hesitancy, as to the

truth of the allegations s ought to be

established. Slomowitz v. Walker , 429 So.

2d 797, 800 (Fla. 4th DCA 1983).

15. Section 212.06(2) defines the term "dealer . "

Respondent , a for - profit corporation operating a restaurant, is

a dealer within the meaning of that definition.

16 . Section 212.15(1) requires that dealers collect and

remit taxes imposed by chapter 212 on a monthly basis.

17. In accordance with section 212.15, the taxes imposed

pursuant to chapter 212 become state funds at the moment of

collection, and the intentio nal failure to remit those taxes

constitutes a theft of state funds.

18. Pursuant to section 2 12.18(3)(a), Respondent is

required to file an application for a certificate of

registration and pay a nominal fee. The application must

include "the names of t he persons who have interests in such

business and their residences, the address of the business, and

such other data as the department may reasonably require."

19. Pursuant to section 2 12.18(3)(b), except for

circumstances inapplicable to this proceeding , "no person shall

engage in business as a dealer . . . without first having

obtained such a certificate or after such certificate has been

cancelled . . . ."

20. S ection 212 .18(3)(d) provides as follows:

(d) The department may revoke any

dealer ' s cert ificate of registration when

the dealer fails to comply with this

chapter. Prior to revocation of a dealer ' s

certificate of registration, the department

must schedule an informal conference at

which the dealer may present evidence

regarding the department ' s intended

revocation or enter into a compliance

agreement with the department. The

department must notify the dealer of its

intended action and the time, place, and

date of the scheduled informal conference by

written notification sent by United States

mail to the dealer ' s last known address of

record furnished by the dealer on a form

prescribed by the department. The dealer is

required to attend the informal conference

and present evidence refuting the

department ' s intended revocation or enter

into a c ompliance agreement with the

department which resolves the dealer ' s

failure to comply with this chapter. The

department shall issue an administrative

complaint under s. 120.60 if the dealer

fails to attend the department ' s informal

conference, fails to en ter into a compliance

agreement with the department resolving the

dealerÓs noncompliance with this chapter, or

fails to comply with the executed compliance

agreement.

21. Petitioner has complied with the foregoing procedures.

22. Petitioner established by clear and convincing

evidence that Respondent has repeatedly failed to comply with

the provisions of chapter 212.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Department of Revenue enter a

fi nal order that revokes Respondent 's certificate of

registration.

DONE AND ENTERED this 24th day of March , 2011, in

Tallahassee, Leon County, Florida.

S

CLAUDE B. ARRINGTON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

12 30 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 24th day of March , 2011.

ENDNOTE

1 Petitioner has filed additional tax warrants against

Respondent for its failure to pay sales tax for periods that

predated the filing of the Administrative Complaint. Except for

tax warrant numbered 1000000100712, the other tax warrants for

the p eriods that predated the Administrative Complaint have been

satisfied. In addition to tax warrant numbered 1000000100712,

two tax warrants remained unsatisfied as of the date of the

formal hearing. The two other tax warrants were for taxes that

were due subsequent to April 20, 2009, the date Petitioner filed

its Administrative Complaint with DOAH. While Petitioner

established that as of February 15, 2011, the total amount

Respondent owed for the three outstanding tax warrants was

$102,269.94. Petitioner did not move to file an amended

administrative complaint to include unpaid taxes for periods

after the date Petitioner filed the Administrative Complaint

with DOAH. The undersigned has not based any conclusions or

recommendations on any unpaid taxes for periods subsequent to

the filing of the Administrative Complaint.

COPIES FURNISHED :

Marshall Stranburg, General Counsel

Department of Revenue

The Carlton Building, Room 204

501 South Calhoun Street

Post Office Box 6668

Tallahassee, Florida 32314 - 6668

Lisa Vickers, Executive Director

Department of Revenue

The Carlton Building, Room 104

501 South Calhoun Street

Tallahassee, Florida 32399 - 0100

Carrol Y. Cherry, Esquire

Office of the Attorney General

Revenue Litigation Bureau

The Capitol, P laza Level 01

Tallahassee, Florida 32399

Robert R. Parker, Jr., Esquire

195 Morton Walk Drive

Alpharetta, Georgia 30022

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Orde r. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.