11-000071PL Department Of Business And Professional Regulation, Division Of Real Estate vs. Anne Hurst Status: Closed Recommended Order on Wednesday, June 8, 2011.

Summary: Respondent's advertisement for property listing included incorrect zoning information, but Petitioner did not prove that she deliberately concealed correct information from Buyer. Recommend violation of 475.25(1)(c), reprimand and $250.00 fine.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

DIVISION OF REAL ESTATE, )

)

Petitioner, )

)

vs. ) Case No. 1 1 - 0071PL

)

ANNE HURST, )

)

Respondent. )

)

RECOMMENDED ORDER

On April 13, 2011 , a duly - noticed hea ring was held in Lake

City , Florida , before Lisa Shearer Nelson , an Administrative Law

Judge assigned by the Division of Administrative Hearings .

APPEARANCES

For Petitioner: Joseph A. Solla, Esquire

Department of Business and

Professional Regulation

Division of Real Estate

400 West Robinson Street, Suite 801N

Orlando, Florida 32801 - 1757

For Respondent: William J. Haley, Esquire

Brannon, Brown, Haley, & Bullock

Post Office Box 1029

Lake City, Florida 32056 - 1029

STATEMENT OF THE ISSUE

The issue to be determined is whether Respondent violated

section 475.25(1)(b) & (c), Florida Statutes (2007), as alleged

in the Ad ministrative Complaint and if so, what penalty should be

imposed?

PRELIMINARY STATEMENT

On July 1, 2010, Petitioner, the Department of Professional

Regulation, Division of Real Estate (Petitioner or DBPR), filed

an Administrativ e Complaint against Respond ent, Anne Hurst

(Ms. Hurst or Respondent), alleging that she violated section

475.25(1)(b) and (c) . Respondent executed an Election of Rights

form July 27, 2010, disputing the allegations in the

Admini strative Complaint and requesting a hearing pursuant t o

section 120.57(1), Florida Statutes. On January 10, 2011, the

case was referred to the Division of Administrative Hearings for

assignment of an administrative law judge.

The case was originally scheduled for hearing March 18,

2011. At the request of b oth parties, the matter was rescheduled

for April 13, 2011, and proceeded as scheduled. At hearing,

Petitioner presented the testimony of Angela Francis, George

Curtis, and Russell Wright. Petitioner's Exhibits 1 - 7 were

admitted into evidence. Responden t testified on her own behalf

and presented the testimony of Doris Redish. Respondent's

Exhibits 1 - 9 were admitted.

The Transcript of the proceedings was filed with the

Division on April 25, 2011. At the request of the parties, the

time for filing propo sed recommended orders was extended until

May 16, 2011. Both parties timely filed Proposed Recommended

Orders which have been carefully considered in the preparation of

this Recommended Order.

FINDINGS OF FACT

1 . Petitioner is the state agency charged wi th regulating

the practice of real estate pursuant to section 20.165 and

chapters 455 and 475, Florida Statutes.

2. At all times material to this Administrative Complaint,

Respondent was licensed as a real estate broker associate in the

State of Florida, having been issued license number 3057283.

3. At all times material to this Administrative Complaint,

Respondent was licensed with Re/Max Professionals, Inc., a real

estate corporation.

4. At the time of hearing, Respondent was licensed with

Access Rea lty of North Florida, Inc., a licensed real estate

corporation.

5. Responde nt's address of record is 757 West Duval Street,

Lake City, Florida 32055.

6. At all times material to the Administrative Complaint,

Respondent was the listing agen t for a proper ty known as 831

South West 5th Street, Live Oak, Florida (5th Street property) .

7. On March 4, 2008, Respondent listed the property as

having a Commercial Intensive (CI) zoning. At the time of the

listing , zoning classifications for property in Live Oak w ere not

available on line, and could onl y be obtained by calling for the

information .

8. At the present time, George Curtis is employed by the

City of Live Oak and handles inquiries regarding zoning for

properties in the City of Live Oak . He does not re call receiving

a telephone call from Respondent regarding the zoning

classification for the 5th Street property . However, at the time

of Respondent's inquiry, Mr. Curtis was just starting his

employment with the city, and did not yet have an office.

Inqu iries were at that time directed t o the City C lerk's office.

Mr. Curtis could not state that no call was received by that

office, or, if received, what information was given.

9. The listing for the property states at the bottom,

" [t] his information is de emed reliable, but is not guaranteed."

Respondent listed the property zoning as CI after calling to

inquire regarding the appropriate zoning for the property. While

she testified that her call was to the Suwannee County office as

opposed to the City of L ive Oak, it is found that the call must

have been made to the City, given the telephone call described

below.

10. The property described in the listing is not zoned CI,

but rather Commercial Neighborhood (CN).

11. In Live Oak, CI zoning is the most inten se zoning

district, and is limited to major arterial roads in the city. It

is intended to meet the needs of a regional population. CN

zoning is intended to provide for commercial use on a more

limited scale, in terms of the size of the building that can be

placed and the types of uses. It is intended to meet the needs

of a neighborhood area.

12. A funeral home would not be a permitted use for

property zoned CN. It would require a zoning change.

13. A funeral home would be permitted on a property zon ed

as commercial general (CG). The CG category is between CI and

CN.

14. In September 2008, Respondent contacted the City of

Live Oak and was referred to George Curtis about the possible use

of the property on SE 5th Street as a daycare. During their

te lephone conversation, he told her that in order to operate a

daycare on the property, the owner would need to receive a

special exception to the zoning requirements. He obtained her e -

mail address and sent her an e - mail with attachments regarding

obtainin g special exceptions. Respondent believed, based upon

their conversation, that the same would be true for any business

to be located on the property.

15. Mr. Curtis does not recall telling Respondent at that

time that the property was not zoned as CI.

16 . On October 16, 2008, Respondent sent the following e -

mail to Mr. Curtis:

Hi George, the contract for a day care on 831

SW 5th Street, Live Oak (lots 14, 15, 16,

Block E, Hildreth) fell through. I now have

a pending contract but the buyers want to use

t he property for a funeral home. Do you see

any problem with this? Anne

17. The e - mail was sent at 5:01 p.m. At 5:22 p.m.,

Mr. Curtis sent the following reply:

Hello Anne:

I believe this property was Neighborhood

Commercial between Green and Ammons o n the

south side of 5th. C - N does not have any

allowances for a Funeral Home, even as a

Special Exception. A petition could be

proposed to the City Council for Residential -

Office or Office Zoning that does allow for

the Funeral Home (with also a Special

Exception) but other criteria would have to

be evaluated to be sure that parting and

buffering requirements could be met after any

zoning change took place -- which is also a

process that is not guaranteed but a

possibility -- there is no way to predict

whethe r the rezoning and the special

exception would be approved. This would

probably be a 4 - 6 month process start to

finish plus the associated fees to try.

Fune ral Homes are allowed by right in General

Commercial Zoning but you have to front a

major street ( 129/90/51, etc. to get

considered for that zoningÈ)

Hope this helps -- wish I had better newsÈ

18. Respondent claims that s he never received this e - mail,

and that she never deleted it from her computer. She testified

that when she did not receive a re sponse, she called the zoning

office and was told that a special exception would be required

for a funeral home. She pa ssed this information on to

Mr. Wright.

19. On October 17, 2008, Russell Wright made an offer to

purchase the property on S.W. 5th Str eet for $45,000 . The

contract (Petitioner's Exhibit 3) has been reduced and copied

several times, and as a result, is illegible in most respects.

However, it can be ascertained that the contract was made on

October 17, 2008, and signed by the sellers on October 22, 2008.

The contract specified that closing was to take place October 31,

2008, which it did. The contract also specified that the Buyers

would pay $5,000 down, and the Sellers w ould finance the

remainder at 8 percent , with payments of $485.31.

20. As part of the closing, the Buyers and Sellers signed

an Affidavit of Buyer and Seller Regarding Contract Compliance,

which stated "all of the contingencies and conditions set forth

in the contract (and all addendums thereto) between the Seller

and Buyer have been satisfied, performed or waived by the Buyer

and the Seller . . . ."

2 1 . Because of the condition of Petitioner's Exhibit 3, it

cannot be determined whether the form contract made any

representations regarding zoning and who was responsibl e for

determining the appropriate zoning for the property.

2 2 . On October 23, 2008, Respondent sent an e - mail to

Russell Wright with attachments labeled "Petition for Special

Exemption," "How the Future Land Use Plan Map - Brochure," and

"Sec. 12.2 Speci al Exceptions." The message in the e - mail reads:

Hi Russ, here's the contact person who deals

with the zoning in Live Oak, and the forms

for filing. I received 1 of the forms back

from you , the As Is Rider but I still need

the corrected Lead based paint disclosure

that I sent with the AS Rider in yesterday's

fax. Please complete this form and fact back

to me. The Seller's [ sic ] are going to close

at 9:00 am on Friday 31st, please let me know

as soon as possible a time that would be

convient [ sic ] for yo u and your wife to

attend. Regards, Anne.

2 3 . Mr. Wright acknowledged receiving an e - mail, but not

the documents. He sent Respondent the other documents required

for closing. After the closing, he called her and stated that he

could not locate the pap erwor k related to special exceptions, and

on November 3, 2008, she mailed it to him. With the paperwork

was the following note:

Dear Russell and Marcus:

I have enclosed the paperwork for the Special

exception. If you have any questions you may

call Georg e Curtis at 386 - 362 - 2276. Mr.

Curtis is the development manager for the

City of Live Oak.

Regards,

Anne

2 4 . Mr. Wright began making renovations on the property in

order to open a funeral home. In July 2009, he began the process

of getting his city o ccupational license. He could not obtain

the license because the property was not zoned for his intended

use.

2 5 . At that point, Mr. Wright contacted city officials,

including George Curtis and the Mayor of Live Oak. Mr. Curtis

advised Mr. Wright that he had sent an e - mail to Respondent

advising her that a funeral home could not be operated on the

property with its present zoning.

26. Mr. Wright wrote to Respondent, demanding that she

compensate him for the fact that he could not open the funeral

ho me without a zoning change. The letter stated in pertinent

part:

The Mayor of Live Oak and Mr. George Curtis

has informed me that I can apply for a zoning

change so that My Wife and I can open our

business. But it will cost $750.00 to file

the initial pa pers . And that is NOT a

guarantee. To date with the down payment and

monthly payments and renovation cost, your

dealings have cost us $25,000 plus pain and

suffering and embarrassment. And we have

property that we can't use for the intention

it was purc hased. Ms. Hurst, we are allowing

you and your firm to settle this matter out

of court.

Ms. Hurst we will settle this matter for the

amount of $50,000.00 which is damages plus

pain and suffering. If you and ReMax

Professionals, Inc., are not willing t o

settle with us out of Court, we will retain

the Attorney with whom my Wife and I have

consulted. . . .

27. It is clear from the evidence that Mr. Wright chose to

believe that he could open a funeral home on the property without

any further administrat ive action either to change the zoning or

to obtain a Special Exception for its intended use. Neither

belief is consistent with the credible evidence that Respondent

sent him information regarding Special Exemptions and the process

to obtain them. All of the information given to him is

consistent with his need to follow up with the City's zoning

department, which he did not do.

28. Based on the more persuasive evidence presented in this

classic, "he - said, she - said" case, it is found that Respondent

did not receive the October 17, 2008 e - mail from George Curtis,

but believed that a Special Exemption would be required to

operate a funeral home on the property, and that she supplied

information to Mr. Wright to that effect. Mr. Wright's claim

that Responde nt represented that the property could be used as a

funeral home with no further action is rejected.

CONCLUSIONS OF LAW

29 . The Division of Administrative Hearings has

jurisdiction over the subject matter and the parties to this

action in accordance with s ections 120.569 and 120.57(1), Florida

Statutes.

30. This disciplinary action by Petitioner is a penal

proceeding in which Petitioner seeks to suspend or revoke

Respondent's license as a real estate associate. Petitioner

bears the burden of proof to demonstrate the allegations in the

Administrative Complaint by clear and convincing evidence. Dep't

of Banking & Fin. v. Osborne Stern & Co. , 670 So. 2d 932 (Fla.

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

31. As stated by the Florida Supreme Court:

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 testimony must

be precise and lacking in confusion as to the

facts in issue. The evidence must be of such

a weight that it produces in the mind of the

trier of fact a firm belief or conviction,

without hesitancy, as to the truth of the

allegations sought to be established.

In re Henson , 913 So. 2d 579, 590 (Fla. 2005), quoting Slomowitz

v. Walker , 429 So. 2d 797, 800 (Fla. 4th DCA 1983).

32. Count One of t he Administrative Complaint alleges that

the Respondent's conduct violated section 475.25(1)(b), which

provides in pertinent part that the Florida Real Estate

Commission may discipline a licensee who:

(b) Has been guilty of fraud,

misrepresentation, concealment, false

promises, false pretenses, dishonest dealing

by trick, scheme, or device, culpable

negligence, or breach of trust in any

business transaction in this state or a ny

other state, nation, or territory; has

violated a duty imposed upon her or him by

law or by the terms of a listing contract,

written, oral, express, or implied, in a real

estate transaction; has aided, assisted, or

conspired with any other person engage d in

any such misconduct and in furtherance

thereof; or has formed an intent, design, or

scheme to engage in any such misconduct and

committed an overt act in furtherance of such

intent, design, or scheme. It is immaterial

to the guilt of the licensee tha t the victim

or intended victim of the misconduct has

sustained no damage or loss; that the damage

or loss has been settled and paid after

discovery of the misconduct; or that such

victim or intended victim was a customer or a

person in confidential relati on with the

licensee or was an identified member of the

general public.

33. The Administrative Complaint states that Respondent

violated section 475.25(1)(b) by concealing the property's proper

zoning as commercial neighborhood as opposed to commercial

intensive; by misrepresenting to the buyer that the property was

zoned as commercial intensive; by concealing from the buyer that

operation as a funeral home would not be permitted; by concealing

from the buyer the e - mail from George Curtis dated October 1 6,

20 08; and by concealing from the b uyer that the operation of a

funeral home was not permitted under a special exemption in a

commercial neighborhood zone.

34. As stated above, the burden of proving the allegations

in the Administrative Complaint is by clear and convincing

evidence, which is a significant burden. In this case, the

burden has not been met.

35. Critical to Petitioner's case is whether Respondent

inquired regarding the zoning when listing the property, and

whether she received the Oct ober 16, 2008 , e - mail notifying her

of its actual zoning status and what would be required to operate

a funeral home on the property. Mr. Curtis testified that, in

March of 2008, zoning inquiries could be made to the clerk's

office, and that the informati on was not then available on the

internet. Respondent claimed that she made an inquiry and was

told the propert y was zoned CI . Her listing for the property

includes the disclaimer that the information included was "deemed

reliable but not guaranteed." U nder these circumstances, the

evidence is not clear and convincing that she knew the property

was zoned CN as opposed to CI.

36. Similarly, the evidence is not clear and convincing

that Respondent received the October 16, 2008 , e - mail from George

Curtis. Mr. Curtis did not have his e - mail settings set to

receive a notice that she did not receive the message, and could

only testify that he sent it. He could not say she received it.

Her subsequent actions are consistent with her testimony that she

did no t receive it. Further , she not only forwarded to

Mr. Wright information related to special exemptions, she

forwarded to him contact information for Mr. Curtis. Forwarding

Mr. Curtis' contact information is inconsistent with concealing

information he had given her.

38. Count Two of the Administrative Complaint charges

Respondent with violating section 475.25(1)(c), which makes it a

violation to "advertise. . . property or services in a manner

which is fraudulent, false, deceptive, or misleading in form or

content. The commission may adopt rules defining methods of

advertising that violate this paragraph."

39. Petitioner did not cite and the undersigned has not

located any rules defining methods of advertising that violate

section 475.25(1)(c). Here, the listing for the property clearly

listed the zoning as CI as opposed to the correct designation,

CN. The advertisement on its face indicated that it was "deemed

reliable but was not guaranteed." The unrebutted evidence was

that Respondent sought info rmation regarding the proper zoning

and was told (mistakenly) that the property was zoned CI. She

did not receive written confirmation of the zoning. Listing the

incorrect information does not rise to the level of fraudulent,

deceptive, or misleading. T he information is, however, false.

Count Two has been proven by clear and convincing evidence.

40 The Florida Real Estate Commission has adopted

disciplinary guidelines to provide notice of the range of

penalties that can be expected for violations of c hapter 475.

For a violation of section 475.25(1)(c), Florida Administrative

Code Rule 61J2 - 24.001(3)(d) provides that the customary penalty

would be a fine of up to $5,000 and up to a one - year suspension.

The rule also specifies aggravating and mitigatin g factors that

can be considered in determining the appropriate penalty,

including the disciplinary history of the licensee. In this

case, the Department presented no evidence to indicate that

Respondent had been disciplined previously. Moreover, she did

check to see what zoning was proper. In this instance, a minimal

penalty is all that should be imposed.

RECOMMENDATION

Upon consideration of the facts found and conclusions of law

reached, it is

RECOMMENDED that the Florida Real Estate Commission enter a

final order dismissing Count One in the Administrative Complaint;

finding a violation of section 475.25(1)(c), as alleged in Count

Two; imposing a reprimand and fining Respondent $250.00.

DONE AND E NTERED this 8th day of June, 2011, in Tallahassee,

Le on County, Florida.

S

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 8th day of June , 2011 .

COPIES FURNISHED:

William Haley, Esquire

Brannon, Brown, Haley,

Robinson & Bullock, P.A.

Post Office Box 1029

Lake City, Florida 32056 - 1029

Joseph A. Solla, Esquire

Department of B usiness and

Professional Regulation

400 West Robinson Street, Suite 801N

Orlando, Florida 32801 - 1757

Thomas W. OÓBryant, Jr., Director

Division of Real Estate

400 West Robinson Street, Suite 801N

Orlando, Florida 32801 - 1757

Layne Smith, General Couns el

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 th e 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.