12-001220PL Department Of Business And Professional Regulation vs. Craig H. Butterfield Status: Closed Recommended Order on Wednesday, December 12, 2012.

Summary: Department failed to prove by clear and convincing evidence that Respondent did not use reasonable diligence in the preparation of an appraisal.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION , )

)

Petitioner , )

)

vs. ) Case No. 12 - 1220PL

)

CRAIG H. BUTTERFIELD , )

)

Respondent . )

)

RECOMMENDED ORDER

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

on September 14, 2012 , by video teleconference in Tallahassee

and Miami, Florida , before Thomas P. Crapps, a designated

Administrative Law Judge of the Division of Administrative

Hearings (DOAH).

APPEARANCES

For Petitioner: Megan Demartini, Esquire

Department of Business and

Professional Regulation

Suite 42

1940 N. Monroe Street

Tallahas see, Florida 32399 - 2202

Jennifer Leigh Blakeman, Esquire

Department of Business and

Professional Regulation

Office of General Counsel

2295 Victoria Avenue, Suite 263

Fort Myers, Florida 33901 - 3877

For Respondent: Daniel Villazon, Esquire

Law Office of Daniel Villazon, P.A.

Suite 200

1420 Celebration Blvd.

Celebration, Flo rida 34747

STATEMENT OF THE ISSUES

Whether Respondent violated section 475.624(15), Florida

Statutes (2010), as alleged in the Administrative Complaint; and

if so, the appropriate penalty. 1/

PRELIMINARY STATEMENT

On June 15, 2011, Petitioner, the Depart ment of Business

and Professional Regulation (Department), filed a one - count

Administrative Complaint before the Florida Real Estate

Appraisal Board against Respondent , Craig H. Butterfield

(Mr. Butterfield). The Administrative Complaint charges

Mr. Butte rfield with violating section 475.624(15) , for failing

to exercise reasonable diligence in developing and preparing an

appraisal report.

On July 15, 2011, Mr. Butterfield filed with the Department

a petition seeking an administrative hearing. On April 6, 2012,

the Department transmitted the case to DOAH, and the case was

set for a final hearing to occur on May 30, 2012. At the

beginning of the May 30, 2012 , hearing, the video teleconference

sites experienced technical difficulties which resulted in an

ina bility to conduct the hearing. As a result, the parties

conferred and requested the undersigned to reschedule the

hearing. Therefore, the undersigned granted a motion to

continue the hearing on May 30, 2012. The final hearing was

rescheduled for final h earing on September 14, 2012.

At the September 14, 2012, hearing, the Department

presented the testimony of Philip G. Spool (Mr. Spool) and

James J. Courchaine (Mr. Courchaine) and introduced into

evidence E xhibits numbered 1 through 4, 6 through 8, 10

thr ough 14, and 16 through 18 and Petitioner's R ebuttal

E xhibit numbered 1. Chapters 120, 455 , and 475, Florida

Statutes ; Florida Administrative Code chapter 61J(1) ; and the

2010 - 2011 edition of the Uniform Standards of Professional

Appraisal Practice (USPAP ) were officially recognized.

Mr. Butterfield testified on his own behalf.

A two - volume Transcript was filed on October 11, 2012, and

the parties submitted proposed recommended orders on

November 12, 2012.

FINDINGS OF FACT

1. Department is the state age ncy charged with regulating

the practice of real estate appraisal pursuant to

section 20.165 and chapters 455 and 475, Florida Statutes.

2. Mr. Butterfield is licensed as a state - certified

general real estate appraiser, holding state license number

RD 1 063. Consequently, he is certified to give residential and

commercial appraisals in Florida. Further, Mr. Butterfield has

been a licensed appraiser in Florida since 1991. In addition to

being licensed in Florida, Mr. Butterfield is licensed in 11

other states, holding seven active and four inactive licenses.

There is no evidence that Mr. Butterfield has any prior

discipline.

3. On April 26, 2010, Mr. Butterfield issued the Appraisal

Report, which is at issue in this administrative hearing. He

prepared the Appraisal Report for Charles Morgan, P.A., a law

firm located in North Miami Beach, Florida. The Appraisal

Report identified the law firm as the intended user and that the

appraisal would be used in litigation. The stated purpose of

the Appraisal Re port was to provide a market value for the

subject property.

4. The subject property of the appraisal is located at

1500 Brickell Avenue, Miami, Florida. 2/ The subject property is

a unique parcel located on Brickell Avenue, near the heart of

Miami's Fina ncial District. The subject property's site is

approximately 15,286 square feet with a 6,497 square foot

building. The building is a French Chateau home constructed in

1928 by John Murrell, a prominent Miami attorney that helped

develop Miami and Coral G ables. The subject property was the

home of Mr. Murrell and his wife Ethel Murrell. Ms. Murrell was

a noted attorney, author, lecturer and known as one of Florida's

leading feminists. Consequently, the subject property has

significant historical value. The building, as described by the

Appraisal Report, "contains two octagonal towers with tent roof,

parpet roof and dormers, crenellated garage roof, and trefoil

arch windows with leaded and stained glass." Clearly, this is a

unique historical building si tuated on one of Miami's most

prestigious streets, Brickell Avenue.

5. The Appraisal Report does not identify whether it is a

self - contained appraisal report, a summary appraisal report or a

restricted use appraisal report , as required by Standards Rule

2 - 2 of USPAP. Similarly, Mr. Butterfield's work file does not

identify the type of appraisal he performed on the subject

property. Rather, Mr. Butterfield's work file shows that he

contracted to provide a "Commercial Narrative Appraisal Report."

Mr. Bu tterfield's uncontradicted testimony that the Appraisal

Report is a summary appraisal report for the intended user, a

law firm, is credible.

6. The complaint against Mr. Butterfield was instigated by

Scott Taylor (Mr. Taylor). Mr. Taylor, a licensed re sidential

appraiser, initially contacted Mr. Butterfield requesting

assistance in appraising the subject property. Because the

subject property appeared to be a commercial property,

Mr. Taylor was not qualified to give an appraisal.

Consequently, Mr. Ta ylor requested Mr. Butterfield's assistance.

Mr. Taylor assisted Mr. Butterfield in the preparation of the

appraisal with the taking of photographs and gathering of

information. However, Mr. Taylor became unhappy with

Mr. Butterfield concerning the paym ent of Mr. Taylor's fee.

According to Mr. Butterfield, Mr. Taylor threatened to file a

complaint with the Department, if Mr. Butterfield did not pay

the fee. Mr. Butterfield refused to pay the disputed amount.

Consequently, Mr. Taylor filed a complaint against

Mr. Butterfield for perceived errors in the appraisal.

7. The record contains no evidence that the intended user,

the law firm, had any complaint concerning the quality of the

work or that the law firm was misled by the Appraisal Report.

8. Th e Department's expert witness, Mr. Spool, has 39

years of experience as an appraiser in the Miami - Dade, County

area. Further, he has taught appraisal practice at Miami - Dade

College, and published numerous articles concerning appraisal

practice.

9. Mr. Sp ool identified USPAP as the standards used by

appraisers in conducting real estate appraisals. Further, he

credibly testified that USPAP standards related to an appraiser

using "reasonable diligence" in preparing an appraisal by

requiring that the apprais er correctly use recognized methods

and techniques to create a credible appraisal.

10. The Appraisal Report contains Mr. Butterfield's

certification that the appraisal was conducted in compliance

with USPAP.

11. The Department's case at the hearing pro ceeded to show

that Mr. Butterfield did not use reasonable diligence in the

preparation of the Appraisal Report along the following four

general lines:

a) The Highest and Best Use section of the

Appraisal Report did not contain any

supporting analyses o r discussion;

b) The Zoning section of the Appraisal

Report did not contain any supporting

analyses or discussion;

c) The comparables used by Mr. Butterfield

were inappropriate, and that he used an

incorrect methodology for determining the

subject prop erty's market value; and

d) The Appraisal Report contained numerous

errors that call into question its

credibility.

Each of these areas is discussed separately

in this Recommended Order.

Highest and Best Use

12. The Appraisal Report here sets out t he Highest and

Best Use of the subject property as following:

The Highest and Best Use of the subject

property could accommodate office usages.

The structure represents a significant

portion of the total value of the whole

property. Therefore, due to the

contributory value of the improvements and

our estimate of the Highest and Best use of

the subject property is its present usage,

as would benefit an owner occupant, or as

present building may generate lease income.

13. The Appraisal Report's discussi on of the subject

property's highest and best use contains what could be best

described as "boilerplate language , " setting out definitions and

the appropriate tests to be applied when reviewing the subject

property. 3/ Mr. Spool's criticism of the Appraisa l Report is not

that Mr. Butterfield reached an inappropriate conclusion, but

rather the lack of analysis. Mr. Butterfield credibly

testified, however, that this appraisal was a summary appraisal

report, and that further analysis was not required. The

un dersigned rejects Mr. Spool's testimony that a more detailed

analysis needed to be contained in the Appraisal Report because

the report is a summary. A review of the appraisal shows that

it summarized the highest and best use of subject property as

its ex isting use. Consequently, the undersigned finds that

Mr. Butterfield's determination of the subject property's

highest and best use complied with USPAP 2 - 2(b). Moreover, the

Comment to Standard 2 - 2(b)(vii) provides that "[b]ecause

intended users' relian ce on a appraisal may be affected by the

scope of work, the report must enable them to be properly

informed and not misled." In the instant case, the Department

did not bring forward any evidence showing that the intended

user, a law firm, had been misled by Mr. Butterfield's

determination of the subject property's highest and best use.

14. The record shows that the Department did not prove by

clear and convincing evidence that Mr. Butterfield failed to use

reasonable diligence in the preparation of the appraisal's

determination of highest and best use.

Zoning

15. Mr. Butterfield specifically identified the subject

property's zoning, at the time of the appraisal, as "R - 3 Multi -

Family with HC - Residential Office Heritage Conservation District

overlay." Mr. Spool's criticism of the Appraisal Report's

zoning section is that Mr. Butterfield's analysis is lacking. A

review Appraisal Report's section titled zoning again includes

mostly "boilerplate language" without analysis , as to the

meaning of the zoning and historical overlay. However,

considering that the Appraisal Report here is a summary

appraisal report prepared for a law firm, the Department did not

prove by clear and convincing evidence that Mr. Butterfield did

not use reasonable diligence. There was no evidence that Mr.

Butterfield's identification of the zoning, without further

analysis, was a lack of reasonable diligence in the context of a

summary. Moreover, there was no evidence that the intended

user, the law firm, was misled by Mr. Butterfi eld's

identification of the proper zoning, without a further analysis.

Market Value Determination

16 . The Department questioned Mr. Butterfield's choice of

his direct sales and rental comparisons, and his methodology in

determining the subject proper ty's market value. Mr. Spool

offered properties that, in his opinion, were more appropriate

comparisons with the subject property and questioned

Mr. Butterfield's methodology. The discussion of each test used

to determine the subject property's market v alue is discussed

separately.

A. Direct sales comparison

17. The Appraisal Report here shows that Mr. Butterfield

identified the three approaches used by appraisers to determine

a property's market value: 1) the cost approach; 2) direct

sales comparis ons; and 3) an income approach. Further, the

Appraisal Report shows that Mr. Butterfield used a direct sales

comparison methodology and income approach to determine the

subject property's market value.

18. In the direct sales comparison, the Appraisal Re port

shows that Mr. Butterfield used four comparable direct sales

within the location of the subject property for his analysis.

Of the four comparable sales identified by Mr. Butterfield, one

involved an office and three involved residential homes. The

r ecord shows that Mr. Butterfield chose to use both an office

and residential properties in the sales comparison because both

uses were permitted by the subject property's zoning. At the

time of the appraisal, the subject property could have been used

as e ither a residence or an office. Consequently, the direct

sales comparison which included both office and residential

sales was appropriate for valuing the subject property. Based

on Mr. Butterfield's testimony and the Appraisal Report, the key

considerat ion in choosing these comparable sales was the

proximity to the subject property's Brickell Avenue address.

Further, a review of Mr. Butterfield's work file shows that he

considered numerous properties for direct sales comparisons in

developing his market value opinion. The key factor for

Mr. Butterfield in preparing his sales comparisons was the

Brickell Avenue location. The undersigned finds Mr.

Butterfield's testimony concerning his use of the comparative

properties and methodology credible.

19. M r. Spool's first criticism was that Mr. Butterfield

used an incorrect methodology in conducting the direct sales

comparison. Specifically, Mr. Spool testified that the highest

and best use of the property, as identified by Mr. Butterfield,

was an office. Consequently, Mr. Butterfield used an incorrect

methodology when he used direct sales from residences for

comparison. In essence, the correct methodology required that

any comparison be made with direct sales of office space or

rather compare "apples to apples and oranges to oranges."

Mr. Spool's criticism that Mr. Butterfield used an incorrect

methodology is rejected because it is based on a wrong premise.

Mr. Butterfield did not identify the subject property's highest

and best use as only an office. The record shows that

Mr. Butterfield identified the subject property's highest and

best use as its permissible uses, which at the time was either a

residence or office. Mr. Butterfield used reasonable diligence

in comparing direct sales from nearby res idences and an office

in his analysis. Next, Mr. Spool identified other properties ,

which in his opinion , were more appropriate as sales

comparisons, such as a historic home near the Miami River that

had been converted into office space. However, the

ide ntification of other properties that could have been used by

Mr. Butterfield does not show that Mr. Butterfield did not use

reasonable diligence in preparing his report. It is noted that

the properties offered by Mr. Spool did not share the Brickell

Avenu e address , which is highly desirable. Consequently, the

undersigned finds that the Department did not prove by clear and

convincing evidence that Mr. Butterfield failed to use

reasonable diligence in the preparation of his direct sales

comparison.

B. Inc ome approach

20. Next, the Appraisal Report shows that Mr. Butterfield

used an income approach to determine the subject property's

market value. The record credibly shows that Mr. Butterfield

identified four rental comparables all located on Brickell

Av enue within close proximity to the subject property, and

verified the rental rate per square foot in the range of $24.00

to $37.00 per square foot.

21. Mr. Spool offered alternative properties that in

his opinion were more appropriate for making a rental

comparison. The crux of the Department's testimony was that

Mr. Butterfield 's use of rental space from new high rises was

inappropriate for comparing with the subject property, which is

an older property. The undersigned, however, finds that

Mr. Butterfi eld's explanation that he chose comparable rental

properties based on the Brickell Avenue address credible.

Again, the fact that other properties may be used as comparable

properties does not show that Mr. Butterfield did not prepare

the Appraisal Report without reasonable diligence. Next,

Mr. Spool's explanation that Mr. Butterfield used an incorrect

methodology for determining an income approach by using

residential properties is rejected. As found earlier,

Mr. Butterfield determined that the subject p roperty's highest

and best use could be either as an office or residence.

Therefore, it was appropriate to determine the rental income

from residences and office space. Moreover, the record shows

that Mr. Butterfield gathered information to determine the per

square - foot income. Therefore, the Department did not prove by

clear and convincing evidence that Mr. Butterfield failed to use

reasonable diligence in the preparation of the appraisal's

income approach analysis.

C. Miscellaneous Errors

22. The App raisal Report does contain several admitted

errors. Examples of the errors are that the Appraisal Report

wrongly indicates that ingress and egress to the subject

property was from Brickell Avenue; that Brickell Avenue was a

minor north - south thoroughfare; that the three residences used

for direct sales comparison were "historic , " as opposed to being

located in "historic South Miami "; that it failed to designate

the type of appraisal that was conduct ed ; and that it did not

state in the certification that Mr . Butterfield had not

personally viewed the subject property. The undersigned finds

that these errors do not rise to the level of showing a lack of

reasonable diligence or could mislead the intended user. For

example, the Appraisal Report attached photog raphs of the three

residences used in the direct sales comparison. The photographs

clearly show that the three residences were not historical

homes, but modern construction. Therefore, it is clear that

Mr. Butterfield took steps to insure that the intend ed user of

the report would know the type of residences which were being

used for comparison with the subject property. Moreover,

concerning the errors about Brickell Avenue, one could safely

assume that a law firm in Miami Beach would know that Brickell

Avenue is a major and desirable location in Miami. Therefore,

the undersigned finds that although the appraisal contains

errors, which were admitted by Mr. Butterfield, those errors are

not of such a nature as to show a lack of reasonable diligence.

CON CLUSIONS OF LAW

23. DOAH has jurisdiction over the subject matter of this

proceeding and of the parties hereto , pursuant to c hapter 120,

Florida Statutes (2012) .

24. As a certified general real estate appraiser,

Mr. Butterfield is qualified to issue ap praisal reports for any

type of real property. § 475.611(1)(h), Fla. Stat.

25. The Department has been statutorily empowered to take

disciplinary action against certified real estate appraisers

based upon any of the grounds enumerated in section 475.624,

Florida Statutes. An evidentiary hearing must be held when

there are disputed issues of material fact. See Hollis v. Dep't

of Bus. & Prof'l Reg . , 982 So. 2d 1237, 1239 (Fla. 5th DCA

2008); §§ 120.569(1) and 120.57(1), Fl a . Stat .

26. The Department has the burden of proving that

Mr. Butterfield engaged in the misconduct, and thereby committed

the violations, alleged in the charging instrument by clear and

convincing evidence. See Dep't of Banking & Fin., Div. of Sec.

and Inv . Prot. v. Osborne Stern & Co . , 670 So. 2d 932, 935 (Fla.

1996); Fox v. Dep't of Health , 994 So. 2d 416, 418 (Fla. 1st DCA

2008); and § 120.57(1)(j), Fla . Stat . ("Findings of fact shall

be based upon a preponderance of the evidence, except in penal

or licensure disciplinary proceedin gs . . . . ").

27. The standard of proof for clear and convincing

evidence requires that the evidence be "credible; the facts to

which the witnesses testify must be distinctly remembered; the

testimony 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 a firm belief or conviction, without hesitancy, as to

the truth of the allegations sought to be established." In re

Dave y , 645 So. 2d 398, 404 (Fla. 1994)(citing with approval,

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

see also In re Adoption of Baby E. A. W. , 658 So. 2d 961, 967

(Fla. 1995)("The evidence [in order to be clear and convincing]

must be su fficient to convince the trier of fact without

hesitancy."). "Although this standard of proof may be met where

the evidence is in conflict, . . . it seems to preclude evidence

that is ambiguous." Westinghouse Elec. Corp. v. Shuler Bros. ,

590 So. 2d 986, 988 (Fla. 1st DCA 1991).

28. In determining whether the Department met its burden

of proof, it is necessary to evaluate its evidentiary

presentation , in light of the specific allegations of wrongdoing

made in the charging instrument. Due process prohibit s the

Department from taking disciplinary action against a licensee

based on conduct not specifically alleged in the charging

instrument, unless those matters have been tried by consent.

See Aldrete v. Dep't of Health, Bd. of Med. , 879 So. 2d 1244,

1246 ( Fla. 1st DCA 2004); Shore Village Prop. Owners' Ass'n. v.

Dep't of Envtl. Prot. , 824 So. 2d 208, 210 (Fla. 4th DCA 2002).

The charging instrument must contain specific factual

allegations describing any misconduct upon which disciplinary

action is based. See Trevisani v. Dep't of Health , 908 So. 2d

1 108, 1109 (Fla. 1st DCA 2005).

29. Furthermore, in deciding whether "the statute or rule

claimed [in the charging instrument] to have been violated" was

in fact violated, as alleged by the Department, if ther e is any

reasonable doubt, that doubt must be resolved in favor of the

licensee. See Djokic v. Dep't of Bus. & Prof'l Reg., Div. of

Real Estate , 875 So. 2d 693, 695 (Fla. 4th DCA 2004); Elmariah

v. Dep't of Prof'l Reg., Bd. of Med. , 574 So. 2 d 164, 165 (F la.

1st DCA 1990).

30. The Administrative Complaint in this case alleged that

Mr. Butterfield violated s ection 475.624(15) by not exercising

reasonable diligence in the developing or preparing an

appraisal. 4/ Specifically, the Department alleged that

Mr . Butterfield failed to exercise reasonable diligence in the

following manner:

a. By missta t ing the prior sales prices of

the Subject Property, specifically the

April 2007 sale.

b. By failing to follow up with obvious

discrepancies regarding the Subjec t

Property's sales history.

c. By failing to clearly indicate highest

and best use.

d. By failing to describe or summarize the

support and rationale for his opinion of

highest and best use.

e. By failing to reach a specific

conclusion of the highest and best use Ð as

if vacant. Ñ

f. By failing to analyze the Subject

Property's zoning.

g. By exercising an inappropriate selection

of comparable sales.

h. By failing to provide support for his

10% positive adjustment for Sales 2, 3 , and

4 for zoning.

i. By failing to discuss the fact that the

Subject Property permits office use based on

the County Land Use Code and three house

sales do not.

j. By failing to discuss that the Subject

Property is designated as a historic

property and all four sales are not.

k. By using an incorrect methodology to

arrive at his concluded value of $340.53 per

square foot.

l. By using an unsupported capitalization

rate, and incorrect methodology to arrive at

a capitalization rate.

m. By exercising a poor choice of

c omparable rentals for the Income Approach.

n. By failing to provide support for his

conclusion of the Subject Property's rental

rate of $31 .00 per square foot or for his

expenses.

o. By failing to provide any data

information from a recognized data sour ce

for any of the four sales and Rentals 2, 3 ,

and 4.

p. By failing to indicate whether the

Report is self - contained, summary , or

restricted use appraisal report.

q. By failing to indicate in the

certification if he made a personal

inspection of the Su bject Property.

r. By failing to identify all extraordinary

assumptions necessary in the assignment.

s. By misstating where ingress/egress to

the Subject Property came from.

t. By misstating that Brickell Avenue was a

minor north/south thoroughfare, when in

actuality access to the Subject Property is

from SW 15th Road, a side street.

u. By failing to include sufficient

information to enable intended users of the

Report to understand it properly.

v. By citing an incorrect source for the

Subject Pro perty's square footage.

w. By failing to be competent to appraise a

property of this type.

x. By failing to be competent to appraise a

property located so far away.

y. By failing to explain how he was

competent to appraise the Subject Property

when h e was located so far away from it.

31. The Administrative Complaint did not charge

Mr. Butterfield with violating section 475.624(14), which

subjects an appraiser to discipline for violating "any standard

for the development or communication of a real e state appraisal

or other provision of the Uniform Standards of Professional

Appraisal Practice." 5/

32. Section 475.624(15) authorizes the Department to take

disciplinary action against a Florida - certified real estate

appraiser who "[h]as failed or refused to exercise reasonable

diligence in developing an appraisal or preparing an appraisal

report." However, there is no statute, rule, or USPAP standard

that defines "reasonable diligence." Dep't of Bus. & Prof'l

Reg., Div. of Real Estate v. Toral , No. 09 - 4 043PL, 2010 Fla.

Div. Admin. Hear. LEXIS 1179 *83 (Fla. DOAH Jan. 28,

2010)(citing Dep't of Bus. & Prof'l Reg., Div. of Real Estate v.

Guilfoyle , No. 07 - 0683PL, 2007 Fla. Div. Adm. Hear. LEXIS 469

*13 (Fla. DOAH Aug . 22, 2007)). Therefore, the Department must

bring forward competent evidence from a person with sufficient

insight into what constitutes reasonable diligence on the part

of a certified general real estate appraiser when developing an

appraisal or in preparing an appraisal report under the

circu mstances that Mr. Butterfield faced in the instant case.

See Dep't of Bus. and Prof'l Reg., Div. of Real Estate v.

Harrison , No. 06 - 3387PL, 2007 Fla. Div. Adm. Hear. LEXIS 315

*24 - 25 (Fla. DOAH May 30, 2007); Dep't of Bus. & Prof'l Reg.,

Div. of Real Esta te v. Catchpole , No. 06 - 3389PL, 2007 Fla. Div.

Adm. Hear. LEXIS 316 *22 - 23 (Fla. DOAH May 30, 2007); and Dep't

of Bus. & Prof'l Reg., Div. of Real Estate v. Price , No. 06 -

3720PL, 2007 Fla. Div. Adm. Hear. LEXIS 249 *26 - 27 (Fla. DOAH

May 3, 2007); see also McDonald v. Dep't of Prof'l Reg. , 582 So.

2d 660, 670 (Fla. 1st DCA 1991)(Zehmer, J., specially

concurring)("[W]here the agency charges negligent violation of

general standards of professional conduct, i.e., the negligent

failure to exercise the degree of care reasonably expected of a

professional, the agency must present expert testimony that

proves the required professional conduct as well as the

deviation therefrom.").

33. Here, there is no dispute that USPAP standards apply

in the preparation of the Appraisal Report. In fact,

Mr. Butterfield certified in the Appraisal Report that he

prepared the appraisal in compliance with USPAP. Consequently,

there is no dispute in this case that an appraiser acts with

"reasonable diligence" if the appraisal is i n compliance with

USPAP. Conversely, failure to comply with USPAP is evidence

that the appraiser did not act with "reasonable diligence."

Mr. Spool's testimony tied the USPAP standards to the

determination of reasonable diligence. Further,

Mr. Butterfi eld's Appraisal Report states that it complied with

USPAP. Thus, there is no dispute that USPAP is applicable and

that failure to follow the standards provides evidence of

whether or not an appraiser acted with reasonable diligence.

The dispute in this c ase turns on whether or not the facts show

a lack of reasonable diligence. The Department presented

evidence supporting its claim through the expert testimony of

Mr. Spool. However, Mr. Butterfield also testified regarding

facts showing his methods in co nducting the appraisal. The

undersigned credits Mr. Butterfield's testimony as showing

reasonable diligence that effectively rebutted Mr. Spool's

testimony.

34. The Department failed to show by clear and convincing

evidence that Mr. Butterfield did not u se "reasonable diligence"

in the preparation of the Appraisal Report.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Florida Real Estate Appraisal

Board enter a final order dismissing the Admini strative

Complaint against Mr. Butterfield .

DONE AND ENT ERED this 1 2 th day of December , 2012 , in

Tallahassee, Leon County, Florida.

S

THOMAS P. CRAPPS

Administrative Law Judge

Division of Administrative Hearings

The DeSo to 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 1 2 th day of December , 2012 .

ENDNOTES

1/ References t o Florida Statutes shall be the 2010 version ,

unless otherwise indicated.

2/ The subject property's legal description is the following:

BRICKELLS FLAGER PB 5 - 44 LOTS 41 & 42 BLK 55

LOT SIZE 84.920 x 180 COC 25565 - 1139 04 2007

5 JOHN M MURRELL & W ETHEL EVERETT V

SUGABAKER OR 12735 - 3254 1185 1 KACHKAR GRP

HOLDINGS INC COC 24509 - 1919 P5 2006 5 .

3/ Boilerplate is defined as "standardized text, formulaic or

hackneyed language." Merriam - Webster, http://www.merriam -

webster.com.

4/ Section 475.624(15) read s as follows:

Discipline. -- T he board may deny an

application for registration or

certification; may investigate the actions

of any appraiser registered, licensed, or

certified under this part; may reprimand or

impose an administrative fine not to exceed

$ 5,000 for each count or separate offense

against any such appraiser; and may revoke

or suspend, for a period not to exceed

10 years, the registration, license, or

certification of any such appraiser, or

place any such appraiser on probation, if it

finds th at the registered trainee, licensee,

or certificate holder:

* * *

(15) Has failed or refused to exercise

reasonable diligence in developing an

appraisal or preparing an appraisal report.

5/ At the beginning of the hearing, the Department sough t

official recognition of the Uniform Standards of Professional

Appraisal Practice (USPAP). Mr. Butterfield's counsel objected

based on the fact that the Board did not allege in its

Administrative Complaint that Mr. Butterfield had violated USPAP

standard s. Thus, USPAP standards were irrelevant to the instant

charges, and would violate Mr. Butterfield's due process. In

response, the Department 's counsel argued that it could not have

charged Mr. Butterfield with violating USPAP because at the time

the app raisal here occurred "the rule was not properly

incorporated in the Florida Statute." The undersigned notes

that section 475.624(14) subjected an appraiser to discipline

for preparing an appraisal that violated USPAP standards.

Therefore, it is not clear to the undersigned why the Department

could not charge Mr. Butterfield with the specific standards

that it believed he violated. Nevertheless, the undersigned

took official recognition of USPAP standards to the extent that

the Department was able to show that those standards established

the relevant standard of care for establishing the "reasonable

diligence" that Mr. Butterfield should have used in p reparing

the Appraisal Report.

COPIES FURNISHED :

Daniel Villazon, Esquire

Daniel Villazon, P.A.

Suite 2 00

1420 Celebration Boulevard

Celebration, Florida 34747

Megan Demartini, Esquire

Department of Business and

Professional Regulation

Suite 42

1940 North Monroe Street

Tallahassee, Florida 32399

Jennifer Leigh Blakeman, Esquire

Department of Business and

Professional Regulation

Office of the General Counsel

2295 Victoria Avenue, Suite 263

Fort Myers, Florida 33901 - 3877

Evalyn Oreto, Chair

Florida Real Estate Appraisal Board

Department of Business and

Professional Regulation

400 West Robinson Str eet, Suite N801

Orlando, Florida 32801

J. Layne Smith, 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 ha ve 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.