99-004363 Department Of Insurance vs. Donna M. Jaquith Status: Closed Recommended Order on Tuesday, May 23, 2000.

Summary: Petitioner, a licensed limited surety agent (bail bondsman), published a deceptive and misleading advertisement and should pay an administrative fine of $100.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF INSURANCE, )

)

Petitioner, )

)

vs. ) Case No. 99-4363

)

DONNA M. JAQUITH, )

)

Respondent. )

__________________________________)

RECOMMENDED ORDER

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

on March 28, 2000, at Fort Lauderdale, Florida, before Claude B.

Arrington, a duly-designated Administrative Law Judge of the

Division of Administrative Hearings.

APPEARANCES

For Petitioner: Miguel Oxamendi, Esquire

Department of Insurance

Division of Legal Services

612 Larson Building

200 East Gaines Street

Tallahassee, Florida 32399-0333

For Respondent: Richard L. Rosenbaum, Esquire

Suite 1500

One East Broward Boulevard

Fort Lauderdale, Florida 33301

STATEMENT OF THE ISSUES

Whether Respondent committed the offenses alleged in the

Amended Administrative Complaint and, if so, the penalties that

should be imposed.

PRELIMINARY STATEMENT

On August 23, 1999, Petitioner filed an Amended

Administrative Complaint against Respondent, a licensed limited

surety agent (bail bondsman), alleging that an advertisement

placed by Respondent in the telephone yellow pages was

misleading or false and that it constituted a deceptive trade

practice. Respondent timely challenged the allegations of the

Amended Administrative Complaint, the matter was referred to the

Division of Administrative Hearings, and this proceeding

followed.

At the formal hearing, Petitioner presented the testimony

of Sally Burt, Wayne Summerlin, and Wayne Spath. Petitioner

presented four exhibits, each of which was admitted into

evidence. Ms. Burt is employed by Petitioner. Mr. Summerlin

and Mr. Spath are licensed bail bondsmen.

Respondent testified on her own behalf and presented the

additional testimony of William Sheppard, Larry Reinfeld, Ted

Moss, Russell Faibisch, Mark Hefferman, and Albert Guilder.

Mr. Fab isch is a national general agent for American Banker's

Insurance company. Mr. Guilder is a former customer of

Respondent. The remaining witnesses are licensed bail bondsmen.

Respondent offered five exhibits, four of which were accepted

into evidence. Respondent's Exhibit 3 was presented as a

proffer, but it was not accepted into evidence.

In addition to the foregoing, the parties entered into a

prehearing stipulation, which stipulated to certain facts.

Those facts have been incorporated as findings of fact to the

extent they are relevant.

A Transcript of the proceedings was filed on April 18,

2000. The Petitioner and Respondent filed proposed recommended

orders, which have been duly-considered by the undersigned in

the preparation of this Recommended Order.

FINDINGS OF FACT

1. At all times pertinent to this proceeding, Respondent

was licensed as a limited surety agent pursuant to Chapter 648,

Florida Statutes.

2. At all times pertinent to this proceeding, Respondent

was an agent of American Banker's Insurance Company with

authority to write surety bonds and/or bail bonds.

3. At all times pertinent to this proceeding, Respondent

was doing business as, or on behalf of, a bail bond business

known as A Aachen Express Bail and/or A Aachen Bail Out,

521 South Andrews Avenue, Suite 2, Fort Lauderdale, Florida.

4. On January 13, 1999, Respondent entered into an

agreement with BellSouth Advertising and Publishing Corporation

that resulted in an advertisement for A Aachen Express Bail in

the April 2000 Greater Fort Lauderdale BellSouth Yellow Pages.

5. The subject advertisement contained the following:

"GUARANTEED LOWEST RATES!" Underneath that statement, in

smaller lettering, was the following: "ALLOWED BY LAW." 1

6. There is only one approved bail bond rate in the State

of Florida. The only bail bond rate that has been approved by

Petitioner is ten percent (10%) for state bonds and fifteen

percent (15%) on Federal bonds, with a minimum premium of fifty

dollars. Respondent, as well as all other bail bond agents in

Florida may only charge a consumer those approved rates.

7. In addition to the foregoing bond rates, bail bond

agents are authorized to impose against consumers certain

incidental charges pursuant to Section 648.44(1)(i), Florida

Statutes. 2

8. It was Respondent's policy to charge ten percent (10%)

for state bonds and fifteen percent (15%) on Federal bonds, with

a minimum premium of fifty dollars. It was Respondent's policy

not to impose any other charges against consumers, including the

incidental charges authorized by Section 648.44(1)(i), Florida

Statutes.

CONCLUSIONS OF LAW

9. The Division of Administrative Hearings has

jurisdiction of the parties to and the subject of this

proceeding. Section 120.57(1), Florida Statutes.

10. Because this is a penal proceeding, Petitioner has the

burden of establishing the allegations against Respondent by

clear and convincing evidence. See Ferris v. Turlington , 510

So. 2d 292 (Fla. 1987); and Department of Banking and Finance,

Division of Securities and Investigator Protection v. Osborne

Stern & Co. , 670 So. 2d 932 (Fla. 1996).

11. Section 648.44(6)(b), Florida Statutes, pertains to

bail bondsmen and provides as follows:

(b) Any misleading or false

advertisement or deceptive trade practice is

prohibited as provided in part X of chapter

626.

12. Respondent has challenged this prohibition on

constitutional grounds. That challenge is rejected because the

undersigned is without jurisdiction to rule a statute

unconstitutional. See Department of Business Regulation,

Division of Alcoholic Beverages & Tobacco v. Ruff , 592 So. 2d

668 (Fla. 1992); and Palm Harbor Special Fire Control District

v. Kelly , 516 So. 2d 249 (Fla. 1987).

13. Section 626.954, Florida Statutes, is included in

Part X of Chap ter 626. Section 626.9541(1)(b), Florida

Statutes, prohibits a licensee, such as Respondent, from

knowingly publishing an advertisement with respect to the

business of insurance which is untrue, deceptive, or misleading.

Section 626.9541(1)(e), Florida Statutes, prohibits a licensee

from placing before the public a false statement.

14. The challenged statement in the advertisement is

literally true, but it is also misleading and deceptive because

it implies that bail bondsmen charge different rates. The clear

inference is that you can get a lower rate from Respondent's

company than you can from other bail bondsmen, which provides

Respondent with an unfair advantage over its competitors.

15. Petitioner established by clear and convincing

evidence that Respondent caused a deceptive and misleading

advertisement to be published in violation of Section

626.954(1)(b), Florida Statutes. Petitioner did not establish

by clear and convincing evidence that Respondent published a

false statement in violation of Section 626.9541(1)(e), Florida

Statutes.

16. The Amended Administrative Complaint also charged that

Respondent demonstrated a lack of fitness or trustworthiness to

engage in the bail bond business in violation of Section

648.45(2)(e), Florida Statutes; that Respondent committed a

fraudulent or dishonest practice in the conduct of her business

in violation of Section 648.45(2)(g), Florida Statutes; and that

Respondent willfully failed to comply with, or willfully

violated, a proper order or rules of the Petitioner in violation

of Section 648.45(2)(j), Florida Statutes. Petitioner failed to

establish those violations.

17. In making the recommendation that follows, the

undersigned has considered the fact that Respondent corrected

her advertisement at her earliest opportunity. The undersigned

has also considered that there was no evidence that any person

was harmed by the deceptive and misleading advertisement.

18. Petitioner has cited no penalty guidelines pertinent

to this proceeding.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that Petitioner enter a final order that

finds Respondent guilty of violating the provisions of Sections

648.44(6)(b) and 626.954(1)(b), Florida Statutes, and imposes

against her an administrative fine in the amount of $100. It is

further recommended that the other violations alleged in the

Amended Administrative Complaint be dismissed.

DONE AND ENTERED this 23rd day of May, 2000, in

Tallahassee, Leon County, Florida.

___________________________________

CLAUDE B. ARRINGTON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 23rd day of May, 2000.

ENDNOTES

1/ After Respondent became aware of the subject complaint, she

changed her advertisement by removing the language at issue in

this proceeding.

2/ Section 648.44(1)( i), Florida Statutes, prohibits a bail

bondsman from accepting ". . . anything of value from a

principal for providing a bail bond except the premium and

transfer fee authorized by the department, except that the bail

bond agent may accept collateral security or other indemnity

from the principal or another person in accordance with the

provisions of s. 648.442, together with documentary stamp taxes,

if applicable."

COPIES FURNISHED:

Miguel Oxamendi, Esquire

Department of Insurance

Division of Legal Services

612 Larson Building

200 East Gaines Street

Tallahassee, Florida 32399-0333

Richard L. Rosenbaum, Esquire

Suite 1500

One East Broward Boulevard

Fort Lauderdale, Florida 33301

Honorable Bill Nelson

State Treasurer and Insurance Commissioner

Department of Insurance

The Capitol, Plaza Level II

Tallahassee, Florida 32399-0300

Daniel Y. Sumner, General Counsel

Department of Insurance

The Capitol, Lower Level 26

Tallahassee, Florida 32399-0300

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.

1 After Respondent became aware of the subject complaint, she changed her

advertisement by removing the language at issue in this proceeding.

2 Section 644.44(1)(i), Florida Statutes, prohibits a bail

bondsman from accepting "… anything of value from a principal

for providing a bail bond except the premium and transfer fee

authorized by the department, except that the bail bond agent

may accept collateral security or other indemnity from the

principal or another person in accordance with the provisions of

s. 648.442, together with documentary stamp taxes, if

applicable. …"