12-003154F Robert Petito vs. Construction Industry Licensing Board Status: Closed DOAH Final Order on Thursday, January 17, 2013.

Summary: Petitioner is not entitled to an award of fees or costs.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ROBERT PETITO , )

)

Petitioner , )

)

vs. ) Case No. 12 - 3154F

)

CONSTRUCTION INDUSTRY )

LICENSING BOARD , )

)

Respondent . )

)

FINAL ORDER

On December 11, 2012, an administrative hearing was held in

Tallahassee, Florida, before William F. Quattlebaum,

Administrative Law Judge, Division of Administrative Hearings.

APPEARANCES

For Petitioner: Rosemary Hanna Hayes, Esquire

Hayes & Caraballo

830 Lu cerne Terrace

Orlando, Florida 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 this case is whether th e Petitioner is entitled

to an award of attorney's fees and costs pursuant to the

statutory provisions referenced herein.

PRELIMINARY STATEMENT

In 2009, Robert Petito (Petitioner) filed an application to

transfer his air conditioning contractor's license f rom one

business entity to another. The Construction Industry Licensing

Board (Respondent) proposed to approve the transfer and impose

restrictions on the Petitioner's license. The Petitioner

challenged the imposition of the restrictions in DOAH Case

No . 10 - 9444. The Respondent ultimately issued the license to the

Petitioner in a Final Order dated September 11, 2011. This case

involves a Motion for Attorney's Fees filed by the Petitioner in

relation to DOAH Case No. 10 - 9444, the facts of which are

incor porated herein as necessary.

At the hearing on December 11, 2012, the Petitioner

presented the testimony of one witness and had Exhibits 1 , 2 , and

4 through 8 admitted into evidence. The Respondent presented the

testimony of one witness and had Exhibits 1 , 5 , and 6 admitted

into evidence.

No hearing transcript was filed. As agreed at the hearing,

both parties filed propose d orders on December 21, 2012.

Also on December 21, 2012, the Petitioner filed a Request

for Extension of Time to File Transcript & Not ice of Submittal of

Recommended Order, wherein the Petitioner requested an extension

of 30 days for the Petitioner to obtain and file a transcript of

the hearing followed by an extension of ten additional days to

submit a revised proposed order. The reque st is hereby denied.

FINDING S OF FACT

1. The Petitioner is a prevailing small business party.

2. In 2009, the Petitioner filed an application with the

Respondent to transfer his Class B air conditioning contractor's

license from o ne business entity to an other.

3. The application form required disclosure of an

applicant's criminal history. The Petitioner responded to the

inquiry with a cursory disclosure of prior criminal activity,

indicating th at he had been involved in such activity in the

"late 1970's . "

4. As part of the application review process, the

Respondent conducted a background investigation that revealed the

Petitioner's criminal history had extended well beyond the

1 970's.

5. Rather than deny the Petitioner's transfer application,

the Respo ndent issued a Notice that provided , in relevant part ,

as follows:

NOTICE OF INTENT 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 reviewed 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 approve d 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 i ssues 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 att endance at the Board

meeting. In connection with each probation

appearance, Applicant shall answer questions

under oath. In addition, applicant shall

provide such other information or

documentation as is requested by the

Department, the Board, or the Pro bation

Committee. Applicant shall forward said

documentation to the Board at least 30 days

in advance of the probation appearance 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 office 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) S hould Applicant violate any condition

of the probation, it shall be considered 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 appearan ce as determined by the

Board, the term of the probationary period

shall be automatically 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 det ermine a third failure

of Applicant to make a satisfactory

appearance, the stay 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 suspended 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 completion 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

probation. 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 Board, 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.

6. The Petitioner c hallenged the imposition of the

conditions in DOAH Case No. 10 - 9444.

7. The Notice cited s ection 455.225, Florida Statutes, as

providing authority for the imposition of the conditions to the

Petitioner's license. The referenced statute identified the

p rocedures through which the Respondent could commence a

disciplin ary action against a licensee.

8. There was no evidence that the Respondent had commenced

or concluded a disciplinary proceeding against the Petitioner

prior to the proposed imposit ion of th e license conditions.

9. The Notice identified two reasons for the proposed

imp osition of license conditions.

10. First, the Notice stated that the Respondent "had

issues with the [Petitioner's] moral character." Second, the

Notice stated that the Petit ioner "failed to sufficiently

demonstrate financial stability and responsibility pursuant to

section 489.115, Florida Statutes and Rule 61G4 - 15.006, Florida

Administrative Code."

11. At the hearing on May 26, 2011, the Petitioner

submitted evidence suff icient to demonstrate compliance with the

cited provisions of statute and rule.

12. A Recommended Order was issued on July 1, 2011 ,

recommending that the Petitioner's application be approved. As

set forth in the Recommended Order, the A dministrative L aw Judge

h ad determined that the Respondent lacked authority to impose

disciplinary conditions absent commencement of a disciplinary

proceeding, and the Petitioner had complied with the requirements

related to financial stability and responsibility at the hearing.

13. By Final Order dated September 8, 2011, the Respondent

granted the Petitioner's license transfer application. The Final

Order adopted the Findings of Fact set forth in the Recommended

Order.

14. The Final Order rejected four paragraphs fr om the

Conclusions of Law section of the Recommended Order that

addressed the Respondent's authority to impose disciplinary

conditions under the circumstances of this case. The remaining

Conclusions of Law in the Recommended Order were accepted.

15. Th e Petitioner is seeking an award of attorney's fees

of $41,554 .00 and costs of $1 , 702.96, fo r a total award of

$43,256.96.

16. The evidence fails to establish that the amount of the

attorney's fees and costs sought by the Petitioner are

reasonable, and t here has been no stipulation by the parties

thereto.

CONCLUSIONS OF LAW

17. The Division of Administrative Hearings has

jurisdiction over the parties to and subject matter of this

proceeding. §§ 57.107, 120.569 and 120.57(1), Fl a. Stat . (2012).

18. Th e Petitioner has the burden of establishing by a

preponderance of the evidence that he is entitled to an award of

attorney 's fees and costs. See Balino v. Dep't of HRS , 348 So.

2d 349, 350 (Fla. 1st DCA 1977) ; and Dep't of Transp. v. J.W.C.

Co., Inc ., 396 So. 2d 778 (Fla. 1st DCA 1981). The burden has

not been met.

19. Section 57.105, Florida Statutes (2009) , provides , in

relevant part , as follows:

Attorney's fee; sanctions for raising

unsupported claims or defenses; service of

motions; damages for delay of litigation. --

(1) Upon the court's initiative or motion

of any party, the court shall award a

reasonable attorney's fee to be paid to the

prevailing party in equal amounts by the

losing party and the losing party's attorney

on any claim or defense a t any time during a

civil proceeding or action in which the

court finds that the losing party or the

losing party's attorney knew or should have

known that a claim or defense when initially

presented to the court or at any time before

trial:

(a) Was no t supported by the material facts

necessary to establish the claim or defense;

or

(b) Would not be supported by the

application of then - existing law to those

material facts.

However, the losing party's attorney is not

personally responsible if he or s he has

acted in good faith, based on the

representations of his or her client as to

the existence of those material facts. If

the court awards attorney's fees to a

claimant pursuant to this subsection, the

court shall also award prejudgment interest.

* * *

(3) At any time in any civil proceeding or

action in which the moving party proves by a

preponderance of the evidence that any

action taken by the opposing party,

including, but not limited to, the filing of

any pleading or part thereof, the as sertion

of or response to any discovery demand, the

assertion of any claim or defense, or the

response to any request by any other party,

was taken primarily for the purpose of

unreasonable delay, the court shall award

damages to the moving party for its

r easonable expenses incurred in obtaining

the order, which may include attorney's

fees, and other loss resulting from the

improper delay.

* * *

(5) In administrative proceedings under

chapter 120, an administrative law judge

shall award a reasonab le attorney's fee and

damages to be paid to the prevailing party

in equal amounts by the losing party and a

losing party's attorney or qualified

representative in the same manner and upon

the same basis as provided in subsections

(1) - (4). Such award shall be a final order

subject to judicial review pursuant to s.

120.68. If the losing party is an agency as

defined in s. 120.52(1), the award to the

prevailing party shall be against and paid

by the agency. A voluntary dismissal by a

nonprevailing party doe s not divest the

administrative law judge of jurisdiction to

make the award described in this subsection.

20. The evidence fails to establish that the Respondent, or

its attorney, knew or should have known that the action would not

have been supported b y facts or law. To the contrary, the

Petitioner failed to disclose his criminal history accurately and

did not comply with financial stability and responsibility

requirements at the time he filed the application. There is no

evidence that the Petitioner complied with the financial

stability and responsibility requirements referenced herein prior

to the May 2011 hearing.

21. The Respondent's Final Order of September 8, 2011 ,

rejected the portion of the Recommended Order's Conclusions of

Law related to its authority to impose disciplinary conditions

under the circumstances of this case, and the Final Orde r remains

the law of the case.

22. The evidence fails to establish that the Respondent

took any action in this case for the purpose of unreasonable

delay.

23. Section 57.111 , Florida Statutes (2009), provides for

an award of attorney ' s fees and costs to a "prevailing small

business party" in an administrative proceeding , " unless the

actions of the agency were substantially justified or special

circumstan ces exist which would make the award unjust." The

referenced statute provides that a proceeding is substantially

justified , "if it had a reasonable basis in law and fact at the

time it was initiated by a state agency." Presuming that a party

establishes that it is a "prevailing small business party," the

agency has the burden of establishing that its action in

initiating the proceeding was "substantially justified." Helmy

v. Dep't of Bus. & Prof'l Reg. , 707 So. 2d 366, 368 (Fla. 1st DCA

1998). The "subs tantially justified" standard falls somewhere

between the "no justiciable issue" standard and an automatic

award of fees to a prevailing party. Id.

24. In this case, the evidence establishes that the

Respondent was substantially justified at the time it t ook action

on the Petitioner's application. As previously noted, the

Petitioner failed to disclose his criminal history accurately on

his application and did not comply with financial stability and

responsibility requirements when the application was file d. T he

Respondent had a reasonable basis in fact and law to support the

proposed action at the time it was taken .

25. The Petitioner has also asserted entitlement to an

award of fees and costs under Section 120.569(2)(e) , Florida

Statutes (2009) , which pr ovides as follows:

All pleadings, motions, or other papers

filed in the proceeding must be signed by

the party, the party's attorney, or the

party's qualified representative. The

signature constitutes a certificate that the

person has read the pleading, motion, or

other paper and that, based upon reasonable

inquiry, it is not interposed for any

improper purposes, such as to harass or to

cause unnecessary delay, or for frivolous

purpose or needless increase in the cost of

litigation. If a pleading, motion , or other

paper is signed in violation of these

requirements, the presiding officer shall

impose upon the person who signed it, the

represented party, or both, an appropriate

sanction, which may include an order to pay

the other party or parties the amoun t of

reasonable expenses incurred because of the

filing of the pleading, motion, or other

paper, including a reasonable attorney's

fee.

26. The evidence fails to establish that the Respondent

filed any pleading, motion , or other paper in this case for an

improper purpose to harass or to cause unnecessary delay, for

frivolous purpose, or to needlessly increase the cost of

litigation.

27. Section 120.595, Florida Statutes (2009) , provides for

an award of reasonable attorney 's fees and costs where a

"nonpr evailing adverse party" has been determined to have

participated in the proceeding for an "improper purpose." In

this case, the Respondent is the nonprevailing adverse party.

Section 120.595(1)(e)1 ., Florida Statutes (2009), provides the

following defini tion:

"Improper purpose" means participation in a

proceeding pursuant to s. 120.57(1)

primarily to harass or to cause unnecessary

delay or for frivolous purpose or to

needlessly increase the cost of litigation,

licensing, or securing the approval of an

act ivity.

28. The evidence fails to establish that the Respondent

participated in the proceeding for an improper purpose. Again,

the Petitioner's application failed to disclose his criminal

history accurately , and he did not comply with financial

stability and responsibility requirements at the time it was

filed.

29. The Respondent proposed to grant the application with

conditions , rather than to deny the application for its

deficiencies. There is no evidence that the Respondent did so

primarily to haras s or delay the Petitioner, for any frivolous

purpose, or to needlessly increase the costs related to the

application.

ORDER

Based on the foregoing Findings of Fact and Conclusions of

Law, it is ORDERED that :

1. The Petitioner's Motion for Attorney's Fee s is hereby

DENIED.

2. The file of the Division of Administrative Hearings is

CLOSED.

DONE AND ORDERED this 17th day of January , 2013 , 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 17th d ay of January , 2013 .

COPIES FURNISHED:

Ken Lawson, Secretary

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399

J. Layne Smith, General Counsel

Department of Business and

Profess ional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399 - 0792

Drew Winters, Executive Director

Construction Industry Licensing Board

Department of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Stre et

Tallahassee, Florida 32399

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

NOTICE OF RIG HT TO JUDICIAL REVIEW

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

to judicial review pursuant to section 120.68, Florida Statutes.

Review proceedings are governed by the Florida Rules of Appellate

Procedure. Such proceedings are co mmenced by filing the original

notice of administrative appeal with the agency clerk of the

Division of Administrative Hearings within 30 days of rendition

of the order to be reviewed, and a copy of the notice,

accompanied by any filing fees prescribed by law, with the clerk

of the District Court of Appeal in the appellate district where

the agency maintains its headquarters or where a party resides or

as otherwise provided by law.