13-004244PL Department Of Business And Professional Regulation, Division Of Real Estate vs. Alfonso Miranda Status: Closed Recommended Order on Wednesday, April 2, 2014.

Summary: Respondent, a real estate sales associate, facilitated the purchase of property without notifying his broker and failing to deliver the deposit to his broker. Recommend $6000 fine and two year suspension of license.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF BUSINESS AND

PROFESSIONAL REGULATION,

DIVISION OF REAL ESTATE ,

Petitioner ,

vs. Case No. 13 - 4244PL

ALFONSO MIRANDA ,

Respondent .

/

RE COMMENDED ORDER

Pursuant to notice, a formal administrative hearing was

conducted before Administrative Law Judge Mary Li Creasy by video

teleconference at sites in Tallahassee and Miami , Florida, on

January 31 , 201 4 .

APPEARANCES

For Petitioner: Christi n a Ann Arzillo, Esquire

Daniel Brackett, Esquire

Department of Business and

Professional Regulation

Suite 42

1940 North Monroe Street

Tallahassee, Florid a 32399 - 2202

For Respondent : Samuel B. Reiner, II, Esquire

Reiner and Reiner, P.A .

Suite 901

9100 South Dadeland Boulevard

Miami, Florida 33156 - 7815

STATEMENT OF THE ISSUE S

The issues to be determined are whether Respondent violated

s ections 475.25(1)(e), 475.42(1)(b), and 475.42(1)(d) , Florida

Statutes (2011 ), and Florida Administrative Code Rule 61J2 -

14.009, as alleged in the Administrative Complaint, and , if so,

what penalty s hould be imposed?

PRELIMINARY STATEMENT

On July 15 , 2013, Petitioner, Department of Business and

Professional Regulation, Division of Real Estate ("Department"),

issued a three - count Administrative Complaint ("Complaint")

against Respondent , Alfonso Mirand a, alleging the statutory and

rule violations described above. Respondent disputed the

allegations in the Complaint and filed a Petition for Formal

Administrative Hearing ("Petition") , which was received by the

Department on August 19, 2013 . The Complain t and Petition were

filed with the Division of Administrative Hearings on October 30,

2013 , with a request that an A dministrative L aw J udge be

assigned.

At the final hearing, which took place on January 31, 2014 ,

the Department called the following witness es: Alfonso Miranda,

Francesca Palmeri, Santo Palmeri, Ricardo Aleman, and Raul

Aleman. Petitioner's Exhibits 1 through 10 were admitt ed in

evidence . Respondent testified on his own behalf , and

Respondent 's Exhibit 6 was admitted .

The final hearing T ran script was filed on March 3 , 2014.

The Department and Respondent timely filed proposed recommended

orders that have been considered in the preparation of this

Recommended O rder.

Unless otherwise noted, citations to the Fl orida Statutes

and Florida Adminis trative Code refer to the 2011 version.

FINDING S OF FACT

1. The Department is the state agency charged with the

licensing and regulation of the real estate industry in the state

of Florida, pursuant to section 20.165 and chapters 455 and 475,

Florida S tat utes.

2. At all times material to this proceeding, Respondent was

a licensed real estate sales associate having b een issued license

number 3101946 . During the time relevant to this case,

Respondent was a sales associate affiliated with Bahia Real

Estat e ( " Bahia " ), a brokerage company owned by Raul and Ricardo

Aleman, with offices located in Miami, Orlando , and Tampa,

Florida. Respondent was employed in Bahia's Miami location.

3. In 2010, Respondent acted as a sales associate on behalf

of Michael Perri cone for a real estate transaction involving the

purchase of a condominium in the Blue Lagoon Towers ("Blue

Lagoon") in Miami which was purchased as an investment.

Mr. Perricone's sister, Francesca Palmeri , and her husband, Santo

Palmeri , were present at t he closing where they met Respondent

for the first and only time . Duri n g the closing, which lasted

approximately one hour, t he Palmeris indicated to Respondent that

they would be interested in making a similar purchase of

investment property if another co mparable condominium unit became

available at Blue Lagoon.

4. The Palmeris had no further interaction with Respondent

until he contacted them at their home in Pueblo, Colorado , in

201 1 to advise them of the availability of a condominium for sale

at Blue L agoon.

5. On or about October 6, 201 1 , Respondent faxed a

pa r tially completed Bahia form "' AS IS ' Residential Contract for

Sale and Purchase " to Mrs. Palmeri for the Palmeris to use in

making an offer on a condominium unit located at 5077 N orthwest

Seven t h St reet , Miami, Florida. Prior to forwarding the document

to Mrs. Palmeri, Respondent wrote on the form the property

description, the escrow agent name and address, the initial

escrow deposit amount and additional deposit, the time for

acceptance, the cl osing date, and listed himself as the

"Cooperating Sales Associate" with "Bahia Realty Group, LLC."

6. The Palmeris decided to offer a $125,000 .00 purchase

price. Respondent directed Mrs. Palmeri to complete the contract

and provide a ten percent escrow deposit. Mrs. Palmeri entered a

purchase price of $125,000 .00 , initialed each page , and signed

the fo r m as "Buyer."

7. R espondent provided Mrs. Palmeri with instructions on

how to wire the funds for the escrow deposit. O n October 7,

201 1 , Mr. Palmeri wi red $12,000 .00 to J.P. Morgan Chase , which

was then deposited in a n account for Bonaventure Enterprises, LLC

( " Bonaventure " ). 1/

8 . The Palmeris had no knowledge of Bonaventure , but , based

upon the representations of Respondent , they understood the money

t hey were asked to wire to the J.P. Morgan Chase account of

Bonaventure was a n escrow deposit for the property they intended

to purchase at Blue Lagoon .

9 . The Palmeris had no discussion with R espondent regarding

the reason for sending the escrow deposit t o Bonaventure . They

assume d that Bonaventure was somehow related to the seller or its

title company. The condominium unit in question was bank owned ;

however, the Palmeris were not informed of this.

10 . No evidence was presented that Respondent had an

ownership interest in Bonaventure . However , Bonaventure is owned

by R espondent's brother and sister - in - law. At all times material

hereto, Respondent was the managing member of Bonaventure.

Bonaventure is not a licensed real estate broker.

11 . Bahia doe s not maintain an escrow account , and its

sales associates are authorized to use title companies of their

choice for receipt of escrow deposits.

12 . Respondent was aware that he was unable to accept the

escrow deposit of the Palmeris in his own name , be cause , as a

licensed real estate sales associate , he is prohibited from

receiving the money associated with a real estate transaction in

the name of anyone other than his broker or employer . In fact,

R espondent was disciplined in 2010 for a similar violat ion . 2/

13 . R espondent claims that the Palmeris entrusted him with

their $12,000.00 to hold for possible investments, not

necessarily related to real estate transaction , and he was doing

it as a favor for them as "friends."

14 . Respondent contradicted himself by stating his

intention in directing the Palmeris to deposit their money into

the Bonaventure account was to help them have cash on hand in

Florida in order to meet the Blue Lagoon condominium seller's

requirements to make the escrow deposit with the seller's title

company within 24 hours after an offer was accepted. The

Palmeris had no knowledge of the seller's unique restrictions on

the escrow money. Further, Respondent's asserted motive in

requesting the $12,000.00 to have cash on hand in Flor ida is

undermined by the fact that , if the Palmeris could wire

$12,000 .00 to Bonaventure's bank account, they could also wire

the funds directly to a title company chosen by the selling bank

after acceptance of their offer .

1 5 . Shortly after returning the contract to Respondent and

sending the escrow deposit, Mrs. Palmeri discussed increasing the

purchase price by $1 , 000 .00 for a total of $ 126,000. 00. Based

upon the language of the proposed contract, the Palmeris expected

a response to their offer within 24 hours.

16 . Immediately thereafter, Respondent told the Palmeris

that they were "in negotiations." However, almost a month passed

before they heard from Respondent regarding the status of the

purchase of the condominium.

17 . On or about November 4, 20 1 1 , Respondent contacted

Mrs. Palmeri and stated that he had "good news." He indicated

that the seller would be willing to sell the property for a pri ce

of $129,500 .00 . According to Respondent, the seller request ed

documentation from the Palmeri s ' bank i ndicating their ability to

pay. Mrs. Palmeri indicated that this was not an acceptable

counter - offer. Respondent suggested that he could negotiate a

sales price of $129,000 .00, but he needed the Palmeris to send an

additional $9 , 000 .00 to put in to escrow . Mrs. Palmeri told

Respondent that she was no longer interested in the property

because their maximum offer was $126,000. 00.

18 . During the same conversation, Mrs. Palmeri asked for

the return of her deposit. Respondent expressed agitation that

she was retreating from the possible purchase because he had done

" so much work. " Respondent clearly anticipated he would receive

a commission if the deal was consummated.

19 . The Palmeris did not get an immediate return of their

escrow deposit. Mrs. Palmeri c alled Respondent repeatedly and

received no answer. She also sent an e - mail to J.P. Morgan Chase

trying to find out the status of the deposit and received no

reply.

2 0 . Mrs. Palmeri again attempted to contact Respondent on

November 18 , 201 1 , and left him a message that he needed to call

her regarding the deposit. After receiving no response, she

contacted Bahia and spoke with Ricardo Aleman. Mrs. Palmeri

explained to Aleman that she had signed a real estate contract

with Respondent on October 6 , 2011 . She no longer wanted to

pursue this real estate transaction and wanted the escrow deposit

returned . Aleman was unaware that Respondent was negotiating a

real esta te transaction for the Palmeris or had accepted their

deposit money.

2 1 . Aleman contacted Re spondent who confirmed by email that

the Palmeri s were no longer interested in pur chasing the

condominium at B lue Lagoon. Respondent wrote, "After a month of

hard work . . . the client decided to drop. It was a little bit

problematic. I lost time and mo ney because the offer was already

accepted and she had no reason to negotiate." Respondent assured

Aleman he would return the deposit to the Palmeris.

2 2 . In accordance with Bahia's policies and procedures, its

sales associates are required to complete a deposit form at the

time of receipt of funds for escrow. No such receipt was

received by Bahia from Respondent with regard to the transaction

involving the Palmeris. However , it was not unusual for Bahia

not to receive information regarding real estate transactions

conducted by their sales associates until the time of closing.

2 3 . After discussing the matter with Aleman, Respondent

advised the Palmeris that he could return their money within ten

days. Respondent advised Mrs. Palmeri that he w ould send her two

checks for the total amount - - one check which she could cash

immediately and a second check w hich would be postdated . In

order to get a return of their deposit, M r s. Palmeri agreed.

2 4 . On or about November 28 , 201 1 , the Palmeris received

two chec ks , each in the amount of $6,000.00, including one

p o s tdated for December 16, 2011. These checks were written on

the account of Bonaventure and signed by Respondent .

CONCLUSIONS OF LAW

A. Jurisdiction

2 5 . The Division of Administrative Hearings has juri sdiction

over the subject matter and the parties to this action in

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

(2013).

B. The Burden and Standard of Proof

2 6 . The Department is seeking to take disciplinary action

against Respondent 's license. Because of the penal nature of the

proceeding, the Department bears the burden of proof to

demonstrate the allega tions in the Comp laint by clear and

convincing evidence. Dep 't of Banking & Fin . v. Osborne Stern &

Co. , 670 So. 2d 932 (Fla. 199 6); Ferris v. Turlington , 510 So. 2d

292 (Fla. 1987).

2 7 . 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 s ought 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).

2 8 . Section 475.25(1)(e) subjects a licensee to discipline

for violating any of the provisions of c hapter 475 or any lawful

order or rule made or issued under the provisions of c hapters 455

or 475.

C. Count One : Alleged Violation of Section 475.25(1)(e) D ue

to Violation of Section 475.42(1)(b)

29 . Count One of the Complaint charges Respondent with a

violation of section 475.42(1)(b) , which prohibits a licensed

sales associate from operating as a broker or operat ing as a sales

associate for any person not registered as her or his employer .

3 0 . To prove that Respondent acted as a broker in violation

of section 4 75.42(1)(b), the Department must demonstrate that

Respondent's actions are within the definition of "broker" in

section 475.01. Section 475.01 defines a "broker" as follows :

(1)(a) "Broker" means a person who, for

another, and for a compensation or valua ble

consideration directly or indirectly paid or

promised, expressly or impliedly, or with an

intent to collect or receive a compensation or

valuable consideration therefor, appraises,

auctions, sells, exchanges, buys, rents, or

offers, attempts or agrees to appraise,

auction, or negotiate the sale, exchange,

purchase, or rental of business enterprises or

business opportunities or any real property or

any interest in or concerning same, including

mineral rights or leases, or who advertises or

holds out to t he public by any oral or printed

solicitation or representation that she or he

is engaged in the business of appraising,

auctioning, buying, selling, exchanging,

leasing, or renting business enterprises or

business opportunities or real property of

others or interests therein, including mineral

rights, or who takes any part in the procuring

of sellers, purchasers, lessors, or lessees of

business enterprises or business opportunities

or the real property of another, or leases , or

interest therein, including mineral rights, or

who directs or assists in the procuring of

prospects or in the negotiation or closing of

any transaction which does, or is calculated

to, result in a sale, exchange, or leasing

thereof, and who receives, expects, or is

promised any compe nsation or valuable

consideration, directly or indirectly

therefor; . . .

3 1 . Count One of the Complaint alleges that Respondent

operated as a broker and was not under the direction, control , or

management of his broker:

a . B y facilitating the purchase of the

subject property by [Santo] Palmeri without

notifying Bahia Real Estate.

b. By collecting Escrow Deposit in

Bonaventure's name.

c. By failing to deliver Escrow Deposit to

Bahia Real Estate.

3 2 . Respondent argues that he cannot be considered ac ting

as a "broker" because he did not receive , and did not expect to

receive , any compensation for assisting the Palmeris in acquiring

the condominium unit at Blue Lagoon.

3 3 . While it is true Respondent received no compensation

because the transaction wa s not completed, Respondent's

testimony, that he was assisting the Palmeris as "a friend" and

that he had no expectation of being paid, is simply not credible.

As explained by the Palmeris, had the transaction closed,

Respondent would have received his co mmission from the seller.

3 4 . Further, Respondent's representation , that he had no

expectation of being compensated, is c ontrary to competent,

substantial evidence . Respondent only met the Palmeris once for

an hour in person, contacted them regarding the property in

question, suggested a ten percent deposit on the property,

identified himself as the buyer's licensed sales associate on the

sales contract, and, when confronted by his broker about the

transaction, Respondent expressed frustration that the de al would

not close because he lost "time and money" attempting to

negotiate a deal over the course of a month.

3 5 . Based on the foreg oing, Respondent violated section

475 .25 (1)( e) by violating section 475.42(1)(b) when Respondent,

acting as a licensed rea l estate sales associate , attempted to

facilitate the purchase of real proper ty by the Palmeris .

Accordingly, C ount One has been demonstrated by clear and

convincing evidence.

D. Count Two : Alleged Violation of Section 475.42(1)(d)

3 6 . Count Two of th e Complaint charges Respondent with a

violatio n of section 475.42(1)(d ) , which prohibits a licensed

" sales associate " from collecting "any money in connection with

any real estate transaction, whether as a commission, deposit,

payment, rental or otherwise, except in the name of the employer

and with the express consent of the employer."

3 7 . Respondent asserts there can be no violation of

section 475.42(1)(d) because the Palmeris' money was not

collected by Respondent , but rather by Bonaventure, which is no t

a sales associate or licensee.

3 8 . Respondent' s semantic gyrations are inconsistent with

competent, substantial evidence. Although Bonaventure is not a

licensee, the Palmeris' money was certainly "collected" by

Respondent. At all times material hereto , Respondent was the

manager of Bonaventure. Respondent had signature authority on

the bank account of Bonaventure in which the Palmeris' money was

deposited. Respondent is the individual who provided instruction

on where the money for the deposit was to be wired. But for

Respondent's wiring instruction, the Palmeris had no information

regarding Bonaventure. When collecting the Palmeris' deposit,

Respondent act ed as an agent for the business enterprise

(Bonaventure) of which he wa s a principal.

39 . Cle ar and convincing evidence demonstrates that the

Palmeris' fund s for the purchase of the Blue Lagoon condominium

were not collected in the name of Bahia or with the express

consent of Bahia . But for Mrs. Palmeri's telephone call to

Aleman to find out the status of her deposit, Aleman and Bahia

would have been completely unaware of the transaction.

4 0 . Based on the foregoing, Respondent violated section

475.25(1)(d) , and Count Two has been demonstrated by clear and

convincing evidence.

E. Count Three : Al leged Violation of Section 475.25(1)(e)

Due to Violation of Florida Administrative Code Rule 61J2 - 14.008

4 1 . Count Three alleges that Respondent violated Florida

Administrative Code Rule 61J2 - 14.009, which provides, "every

sales associate who receives an y deposit, as defined in

rule 61J2 - 14.008, Florida Administrative Code, shall deliver the

same to the broker or employer no later than the end of the next

business day following receipt of the item to be deposited."

4 2 . Rule 61J2 - 14.008 defines a deposit as, "a sum of money,

or its equivalent, delivered to a real estate licensee, as

earnest money, or payment, or part payment, in connection

with any real estate transaction named or described in

section 475.01(1)(a), F.S."

4 3 . The $12,000.00 forwarded to Bo naventure, as directed

by Respondent, is clearly a "deposit" within the meaning of

r ule 61J2 - 14.008. As discussed above, the fact that the money

was arguably "delivered" to the bank account of Bonaventure,

rather than Respondent, does not negate the fact that Respondent

was acting in his own interest rather than for his broker or

employer. At no time was the deposit forwarded to Bahia , and at

all times, the Palmeris' money was within the control of

Respondent.

4 4 . Although evidence was presented that Bah ia did not have

its own escrow account and that its sales associates usually

place escrow money with the title company designated for a real

estate transaction, Respondent's obligations pursuant to the

rules governing his license are not negated.

4 5 . Base d on the foregoing, Respondent violated r ule 61J 2 -

14.009 , and Count Three has been demonstrated by clear and

convincing evidence.

F. The Appropriate Remedy

4 6 . Rule 61J2 - 24.001 sets forth the penalty guidelines

established by the FREC "from which discipl inary penalties will

be imposed upon licensees guilty of violating Chapter 455

or 475, F.S."

4 7 . The penalties for the violations proven by the

D epartment in this case are as follows:

a. Pursuant to r ule 61J2 - 24.001(3)(x ), a second and

subsequent violati on of s ection 475.42 (1)( b ) carries a penalty of

an administrative fine ranging from $1,000.00 to $5,000.00 and

suspension to revocation.

b. Pursuant to r ule 61J2 - 24.001(3)(z), a violation of

s ection 475.42(1)(d ) carries a penalty of an administrative fine

ranging from $ 25 0.00 to $ 1 ,000.00 and suspension to revocation.

c. Pursuant to r ule 61J2 - 24.001(3)( f) , a second and

subsequent violation of section 475.25(1)(e) carries a penalty of

an administrative fine ranging from $ 1,000.00 to $ 5000.00 and

suspension to revocation.

4 8 . The penalties recommended herein fall within the ranges

set forth in the penalty guidelines:

a. Count One: A penalty of $2,500.00 for violation of

s ection 475. 42(1)(b) .

b. Count Two : A penalty of $1,000.00 f or violation of

s ection 475.42(1)(d).

c. Count Three : A penalty of $2 , 5 00.00 for violati on of

s ection 475.25(1(e).

d . Suspension of Respondent's license f or a period of two

years.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Department of Business and

Professional Regulation, Division of Real Estate, enter a final

order imposing on Alfonso Miranda an administrative fine in the

amount of $6,000.00 and suspending the real estate sales

associate license of Alfonso Mirand a for a period of two years.

DONE AND ENTERED this 2nd day of April , 2014 , in

Tallahassee, Leon County, Florida.

S

MARY LI CREASY

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apal achee 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 2nd day of April , 2014 .

ENDNOTE S

1/ The Palmeris credibly testified that Mr. Palmeri incorrectly

calculated the deposit due as $12,000.00 rather than $12,500.00.

2/ By Final Order of the Florida Real Estate Commission (FREC)

dated October 22, 2010, Respondent was fined $1,500.00 , assessed

administrative costs of $471.90, pla ced on probation for six

months , and required to attend a two - day FREC meeting for

violating sections 475.42(1)(b), 475.25(1)(e), and 475.42(1)(a).

These penalties were assessed because i n 2006, Respondent

negotiated sales and purchase contracts for real estate, accepted

an "escrow deposit , " and claimed commission entitlement when he

was not the holder of a valid and current active real estate

license.

COPIES FURNISHED:

Samuel B. Reiner, II, Esquire

Reiner and Reiner, P.A .

Suite 901

9100 South Dadeland Boulevard

Miami, Florida 33156 - 7815

Christina Ann Arzillo, Esquire

Daniel Brackett, Esquire

Department of Business and

Professional Regulation

Suite 42

1940 North Monroe Street

Tallahassee, Florida 32399 - 2202

J. Layne Smith, General Counsel

Departmen t of Business and

Professional Regulation

Northwood Centre

1940 North Monroe Street

Tallahassee, Florida 32399 - 2201

Juana Watkins, Director

Division of Real Estate

Department of Business and

Professional Regulation

400 West Robinson Street, Suite N80 1

Orlando, Florida 32801

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have 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.