12-001970PL Department Of Business And Professional Regulation, Construction Industry Licensing Board vs. Larry M. Provencal Status: Closed DOAH Final Order on Thursday, July 19, 2012.

Summary: Respondent's guilty plea to conspiracy to commit mail and wire fraud is directly related to contracting. Two-year suspension, three-year probation and $5000 fine imposed.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND )

PROFESSIONAL REGULATION, )

CONSTRUCTION INDUSTRY )

LICENSING BOARD , )

)

Petitioner , )

)

vs. ) Case No. 12 - 1970PL

)

LARRY M. PROVENCAL , )

)

Respondent . )

)

FINAL ORDER

On June 15, 2012, a hearing was held pursuant to sections

120.57(1) and 120.574, Florida Statutes (2012), by means of video

teleconferencing with sites in Jacksonville and Tallahassee,

Florida, before Administrative Law Judge Lisa Shearer Nelson of

the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Kyle Christopher, Esquire

James Fortunas, Esquire

Department of Business and

Professional Regulation

1940 North Monroe Street

Tallahassee, Florida 32399

For Respondent : Larry M Provencal, pro se

1232 Wild Turkey Court

St. Johns, Florida 32259

STATEMENT OF THE ISSUE

The issue to be determined is whether Respondent violated

section 489.129(1)(b), Florida Statutes (2010), by being

convicted or found guilty of, or entering a plea of nolo

contendere to, regardless of adjudication, a crime directly

related to the practice or the ability to practice contracting.

If so, it must also be determined what penalty should be imposed

for the violation.

PRELIMINARY STATEMENT

On M ay 4, 2012, Petitioner, the Department of Business and

Professional Regulation ("Petitioner" or "the Dep artment") filed

an Administrative Complaint charging Respondent, Larry M.

Provencal ("Respondent" or "Mr. Provencal") with violating

section 489.129(1)(b). On May 24, 2012, Respondent filed an

election of rights form disputing allegations in the

Administr ative Complaint and requesting a hearing pursuant to

section 120.57(1). On June 1, 2012, the case was referred to the

Division of Administrative Hearings for assignment of an

administrative law judge.

On that same day, the Department moved for summary he aring

pursuant to section 120.574(b), alleging that the issues in the

hearing would be limited in scope and that Respondent was

obligated to report for incarceration on June 21, 2012. The

parties were in agreement that the hearing should be conducted

before Respondent was obligated to report. Accordingly, on

June 5, 2012, a Notice of Summary Final Hearing by Video

Teleconference was issued, scheduling the case for hearing on

June 15, 2012, and the case proceeded as scheduled.

Prior to hearing, the pa rties submitted a Joint Prehearing

Stipulation in which certain facts were stipulated to and, where

relevant, have been incorporated into the Findings of Fact below.

At hearing, Petitioner presented the testimony of Respondent,

Larry Provencal, and Petiti oner's Exhibits 1 - 5 were admitted into

evidence without objection. Respondent testified on his own

behalf and submitted no exhibits. The one - volume Transcript was

filed with the Division o n July 11, 2012. Both parties submitted

Proposed Final Orders tha t have been considered in the

preparation of this Final Order.

FINDINGS OF FACT

1. Petitioner is the state agency charged with the

licensing and regulation of contractors pursuant to section

20.165 and chapters 455 and 489, Florida Statutes .

2. Responden t holds an active license as a certified

general contractor, having been issued license number CGC 1515398

on April 30, 2008. He is also the qualifier for P ro Group

Construction, Inc. Respondent's license expires August 31, 2014.

3. On or about October 15, 2009, Respondent was charged by

the United States Government in a one - count Information with

conspiracy to commit wire and mail fraud in violation of 18

U.S.C. § 371.

4. On April 5, 2011, Respondent pled guilty to Count I of

the Information, and was a djudicated guilty.

5. On March 20, 2012, Respondent was sentenced to

incarceration for one year and one day, supervised release for a

period of three years upon completion of his prison sentence, and

payment of restitution in the amount of $182,294.83 t o Wells

Fargo Bank.

6. Included in the terms of supervision, are the following:

* The Defendant shall provide the probation

officer access to any requested financial

information.

* The defendant shall be prohibited from

incurring new credit charges, opening

additional lines of credit, acquisitions or

obligating himself for any major purchases

without approval of the probation officer.

* The defendant shall be prohibited from

engaging in any employment related to the

buying and selling of real estate .

7. The scheme to which Respondent pled guilty involved

fraudulent statements to a lending institution, i.e., Wells Fargo

Bank, to induce the lender to believe that buyers had the funds

to make down payments on foreclosed properties in order to

qualify for loans when in fact the buyers did not have those

funds.

8. The conduct from which the criminal charges arose

occurred prior to Respondent's licensure as a certified general

contractor. The guilty plea and the judgment and sentencing all

occurred while Respondent held his contractor's license.

9. Respondent admitted at hearing that his actions, which

resulted in the criminal proceedings, were wrong, and he takes

responsibility for his wrongdoing. He asserts, however, that

because he was not l icensed at the time of the conduct, it has

nothing to do with his license as a certified general contractor.

He was, instead, licensed as a mortgage broker.

10. However, contractors routinely interact with customers,

deal with contracts for the building of or improvement of

buildings, handle money and checks, and have direct involvement

with lending institutions. Respondent admitted that, if he had

an employee with a conviction for a crime such as the crime for

which he pleaded guilty, that employee wou ld not be permitted to

handle money on behalf of his company.

CONCLUSIONS OF LAW

11 . The Division of Administrative Hearings has

jurisdiction over the subject matter and the parties to this

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

120.5 74, Florida Statutes.

12 . Ordinarily, license disciplinary proceedings initiated

by the Department are presented to the Construction Industry

Licensing Board for final agency action, and the administrative

law judge submits a recommended order for the Board's

consideration. In this case, however, the parties have invoked

the summary procedures of section 120.574, which provides in

pertinent part:

(1)(b ) Within 15 days after service of the

initial order, any party may file with the

division a motion fo r summary hearing in

accordance with subsection (2). If all

original parties agree, in writing, to the

summary proceeding, the proceeding shall be

conducted within 30 days of the agreement, in

accordance with the provisions of subsection

(2).

* * *

(2 ) In any case to which this subsection is

applicable, the following procedures apply:

* * *

(b ) Not later than 5 days prior to the final

hearing, the parties shall furnish to each

other copies of documentary evidence and

lists of witnesses who may testify at the

final hearing.

(c) All parties shall have an opportunity to

respond, to present evidence and argument on

all issues involved, to conduct cross -

examination and submit rebuttal evidence, and

to be represented by counsel or other

qualified representative.

(d ) The record in a case governed by this

subsection shall consist only of:

1. All notices, pleadings, motions, and

intermediate rulings.

2 . Evidence received.

3 . A statement of matters officially

recognized.

4 . P roffers of proof and objections and

rulings thereon.

5 . Matters placed on the record after an ex

parte communication.

6 . The written decision of the

administrative law judge presiding at the

final hearing.

7 . The official transcript of the final

hearing .

(e ) The agency shall accurately and

completely preserve all testimony in the

proceeding and, upon request by any party,

shall make a full or partial transcript

available at no more than actual cost.

(f ) The decision of the administrative law

judge shall be rendered within 30 days after

the conclusion of the final hearing or the

filing of the transcript thereof, whichever

is later. The administrative law judgeÓs

decision, which shall be final agency actio n

subject to judicial review under s. 120.68 ,

shall include the following:

1 . Findings of fact based exclusively on the

evidence of record and matters officially

recognized.

2 . Conclusions of law.

3 . Imposition of a fine or penalty, if

applicable.

4 . Any other information required by law or

rule to be contained in a final order.

13. This is a proceeding to take disciplinary action

against Respondent's license to practice as a certified general

contractor . Because of the penal nature of these procee dings,

the Department has the burden of proving the allegations in the

Administrative Complaint by clear and convincing evidence. Dep't

of Banking and Fin. v. Osborne Stern and Co. , 670 So. 2d 932

(Fla. 1996); Ferris v. Turlington , 510 So. 2d 292 (Fla. 19 87).

As stated by the Supreme Court of Florida,

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 co nfusion 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) ) .

14. The Administrative Complaint charges Respondent with a

violation of section 489.129(1)(b), which authorizes disciplinary

action against a licensee or certi ficateholder for "[b]eing

convicted or found guilty of, or entering a plea of nolo

contendere to, regardless of adjudication, a crime in any

jurisdiction which directly relates to the practice of

contracting or the ability to practice contracting."

15. T here is no real dispute that Respondent has pled to

and has been adjudicated guilty of conspiracy to commit wire and

mail fraud. What Respondent disputes is whether the criminal

proceeding has anything to do with his practice or ability to

practice contra cting.

16. Respondent's conviction for conspiracy to commit wire

and mail fraud is clearly related to the practice or the ability

to practice contracting. In Doll v. Department of Health , 969

So. 2d 1103, 1106 (Fla. 1st DCA 2007), a chiropractor pled guilty

to a charge of conspiracy to defraud a health beneficiary program

in violation of 18 U.S.C. §§ 371 and 1347. In determining that

the crimes for which Doll pled guilty were directly related to

t he practice or the ability to practice chiropractic medicine,

the First District stated:

Several cases demonstrate that, although the

statutory definition of a particular

profession does not specifically refer to

acts involved in the crime committed, the

crime may nevertheless relate to the

profession. In Greenwald v. Department of

Professional Regulation , the court affirmed

the revocation of a medical doctor's license

after the doctor was convicted of

solicitation to commit first - degree murder.

501 So. 2 d 740 (Fla. 3d DCA 1987). The Fifth

District Court of Appeal has held that

although an accountant's fraudulent acts

involving gambling did not relate to his

technical ability to practice public

accounting, the acts did justify revocation

of the accountant 's license for being

convicted of a crime that directly relates to

the practice of public accounting. Ashe v.

Dep't of Prof'l Regulation, Bd. of

Accountancy , 467 So. 2d 814 (Fla. 5th DCA

1985). We held in Rush v. Department of

Professional Regulation, Bo ard of Podiatry ,

that a conviction for conspiracy to import

marijuana is directly related to the practice

or ability to practice podiatry. 448 So. 2d

26 (Fla. 1st DCA 1984). These cases

demonstrate, in our view, that appellee did

not err by concluding Do ll's conviction was

"related to" the practice of chiropractic

medicine or the ability to practice

chiropractic medicine.

17. The same can be said with respect to the crimes for

which Respondent was convicted. See also Mendez v. Dep't of

Health , 943 S o. 2d 909 (Fla. 1st DCA 2006); Dep't of Health v.

Catanese , DOAH No. 07 - 2864 (DOAH Dec. 19, 2007; Fla. Bd. of

Chiro. Med. Mar. 10, 2008); Dep't of Health v. Zamora , DOAH No.

07 - 1454 (DOAH July 20, 2007; Fla. Bd. of Med. Oct. 22, 2007).

18 . While Respond ent asserted at hearing that his crimes

were not related to his contracting practice, he acknowledged the

connection in terms of those functions a contractor performs that

are similar to those performed by a mortgage broker. Respondent

acknowledged that a s a mortgage broker, he had a fiduciary duty

to the bank he defrauded. A similar duty exists with respect to

clients in the contracting business. The Department argues that

contractors are responsible for constructing buildings or

structures in accordanc e with applicable codes and laws, and are

expected to deal honestly with consumers. They handle cash and

checks and deal with consumers, suppliers, banks and other

financial institutions as a part of the practice. Respondent's

conviction, the Department argues, demonstrates Respondent's

willingness to illegally profit at the expense of the entity to

which he owed a fiduciary duty.

1 9 . Section 489.105(3) defines a contractor in part as:

the person who is qualified for, and is only

responsible for, the project contracted for

and means, except as exempted in this part,

the person who, for compensation, undertakes

to, submits a bid to, or does himself or

herself or by others construct, repai r,

alter, remodel, add to, demolish, subtract

from, or improve any building or structure,

including related improvements to real

estate, for others or for resale to others ;

and whose job scope is substantially similar

to the job scope described in one of t he

paragraphs of this subsection. ( Emphasis

supplied ).

20 . Respondent is a general contractor, which is further

defined as a contractor whose services are unlimited as to the

type of work which he or she may do, who may contract for any

activity requiring licensure under this part, and who may perform

any work requiring licensure under this part . . . ."

2 1 . Respondent is also the qualifier for Pro Construction,

Inc., and governed by the provisions of section 489.119, which

provides in pertine nt part:

(2) (b)1 . An application for registration or

certification to qualify a business

organization must include an affidavit on a

form provided by the board attesting that the

applicant has final approval authority for

all construction work performed by the

business orga nization and that the applicant

has final approval authority on all business

matters, including contracts, specifications,

checks, drafts, or payments, regardless of

the form of payment, made by the business

organization, except where a financially

respons ible officer is approved .

* * *

(c) The board may deny an application for

registration or certification to qualify a

business organization if the applicant, or

any person listed in paragraph (a), has been

involved in past disciplinary actions or on

any grounds for which an individual

registration or certification may be denied.

( Emphasis supplied ) .

22 . Clearly, the definitions delineating the scope of

Respondent's practice demonstrate that actions taken pursuant to

his license involve far more than th e technical aspects of

construction. The financial aspect of managing construction

projects is an integral part of the practice. For Respondent,

restrictions on his actions during his supervised release

described in paragraph six, restricting his financi al activities

and prohibit ing him from engaging in any employment related to

the buying and selling of real estate , would have a direct

bearing on his practice of contracting. The conviction is

directly related to his ability to practice contracting. The

Department has proven a violation of section 489.129(1)(b) by

clear and convincing evidence.

23 . Section 455.2273, Florida Statutes, requires all

professional boards within the Department to adopt disciplinary

guidelines which " specify a meaningful range of designated

penalties based upon the severity and repetition of specific

offenses ." Administrative law judges are required to follow the

disciplinary guidelines established by the applicable regulatory

entity and must state in writing the mitigati ng or aggravating

circumstances upon which the recommended penalty is based.

2 4 . For a violation of section 489.129(1)(b), Florida

Administrative Code Rule 61G4 - 17.001 provides that the minimum

penalty is a $2,500 fine and/or probation or suspension. Th e

maximum penalty is a $10,000 fine and revocation.

2 5 . Rule 61G4 - 17.002 identifies the aggravating and

mitigating circumstances to be considered in determining the

appropriate penalty as follows:

(1) Monetary or other damage to the

licenseeÓs custome r, 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 - sit e 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 licenseeÓs customer.

(7) The deterrent effect of the penalty

imposed.

(8) The effect of the penalty upon the

licenseeÓs livelihood.

( 9) Any efforts at rehabilitation.

(10) Any other mitigating or aggravating

circumstances.

2 6 . While Respondent was not licensed at the time of the

underlying conduct, he did have a c lien t as a mortgage broker who

was harmed , and restitution to the institution is still pending .

The second factor does not apply, as the conduct did not involve

construction by Respondent. To the extent that there was

financial fraud on a lending institution, the public was harmed.

A sin gle complaint with a single count was filed against

Respondent, and he has been licensed a relatively short period of

time. There was no physical damage to the lending institution,

and the monetary damage has been considered under paragraph (1).

Suspensi on or revocation will have a significant effect on

Respondent's livelihood. Given the amount of the restitution

outstanding to be paid upon Respondent's release, Respondent will

be paying for his conduct for quite some time.

2 7 . While the Department ass erts that Respondent presented

no evidence in mitigation, that assertion is incorrect.

Respondent testified credibly that what he did was wrong and he

took responsibility for his actions. His unrebutted testimony is

that he provided substantial assistanc e to the federal

authorities. His incarceration obviously prevents him from using

his license while imprisoned, and he will face significant

difficulties when he is released from prison.

2 8 . That being said, the penalty for engaging in the scheme

descri bed in the information must be significant enough to create

a deterrent effect, yet not deprive Respondent of the ability to

ever repay the debt he owes. While Respondent's conduct is

serious, it is a single count for conduct that occurred prior to

Respon dent's licensure.

CONCLUSION

In view of the foregoing findings of fact and conclusions of

law it is hereby

ORDERED that Respondent has violated section 489.129(1)(b),

Florida Statutes (2010) as alleged in the Administrative

Complaint. For this violation, Respon dent shall pay a fine of

$5,000 and have his license to practice contracting suspended for

a period of two years. Following the two - year suspension,

Respondent's license shall be on probation for a period of three

years, subjec t to terms to be set by the Construction Industry

Licensing Board upon reinstatement.

DONE AND ORDERED this 19 th day of July , 20 12 , in

Tallahassee, Leon County, Florida.

S

LISA SHEARER NELSON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative He arings

this 19 th day of July, 2012 .

COPIES FURNISHED:

Kyle Christopher, Esquire

Department of Business and

Professional Regulation

Suite 42

1940 North Monroe Street

Tallahassee, Florida 32399 - 2202

[e-mail]

Larry M. Provencal

PRO Group Construction, Inc.

1232 Wild Turkey Court

Jacksonville, Florida 32259

James Fortunas, Esquire

Department of Business

and Professional Regulation

1940 North Monroe Street

Tallahassee, Florida 32399

[e-mail] .fl.us

Ken Lawson, Secretary

Department of Business

and Professional Regulation

1940 North Monroe Street

Tallahassee, Florida 32399

Layne Smith, General Counsel

Department of Business

and Professional Regulation

Northwood Centre

1940 North Monroe St reet

Tallahassee, Florida 32399 - 0792

Drew Winters, Executive Director

Construction Industry Licensing Board

Department of Business

and Professional Regulation

1940 North Monroe Street

Tallahassee, Florida 32399

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party who is adversely affected by this Final Order is entitled

to judicial review pursuant to s ection 120.68, Florida Statutes.

Review proceedings are governed by the Florida Rules of Appellate

Procedure. Such proceedings are commenced by filing the original

notice of appeal with the Clerk of the Division of Administrative

Hearings and a copy, accompanied by filing fees prescribed by

law, with the District Court of Appeal, First District, or with

the District Court of Appeal i n the Appellate District where the

party resides. The notice of appeal must be filed within 30 days

of rendition of the order to be reviewed.