STATE OF
FLORIDA
COMMISSION
ON ETHICS
In re DAVID WHITEHEAD, )
) Complaint
No. 98-188
Respondent. )
DOAH
Case No. 00-0266EC
)
) Final
Order No. 00-053
________________________)
FINAL
ORDER AND PUBLIC REPORT
This
matter came before the State of Florida Commission on Ethics, meeting in public
session on November 17, 2000, pursuant to the Recommended Order of the Division
of Administrative Hearings' (DOAH) Administrative Law Judge (ALJ) rendered in this matter on August 15, 2000
(a copy of which is attached and incorporated by reference). The ALJ recommends that the Commission enter
a final order and public report finding that Respondent, DAVID WHITEHEAD, as a
member of the Escambia County Commission, violated Section 112.313(7)(a),
Florida Statutes, by having a contractual relationship with B & W
Productions of Pensacola, Inc. (B & W Productions), and finding that
Respondent did not violate Section 112.3143(3)(a), Florida Statutes, by voting
on various measures. As to the
violation, the ALJ recommends that a civil penalty of $2,000 be imposed against
the Respondent, and that he be publicly censured and reprimanded.
By order
rendered December 2, 1999, the Florida Commission on Ethics (Commission) found
probable cause to believe that the Respondent, as a member of the Escambia
County Commission, violated Section 112.313(7)(a), Florida Statutes, by having
or holding employment or a contractual relationship with B & W Productions
which created a continuing or frequently recurring conflict between his private
interests and the performance of his public duties or which impeded the full
and faithful discharge of his public duties, and found probable cause to
believe that the Respondent violated Section 112.3143(3)(a), Florida Statutes,
regarding measures concerning several companies with business before the County
Commission. This matter was forwarded
by the Commission to DOAH for assignment of an ALJ to conduct the formal
hearing and prepare a recommended order.
A formal evidentiary hearing was held before the ALJ on April 28, 2000,
by video conference at sites in Pensacola and Tallahassee, Florida. A transcript of the hearing was filed and
the parties then filed proposed recommended orders with the ALJ. By order rendered July 7, 2000, the ALJ
denied a post-hearing motion filed by Respondent. The ALJ’s Recommended Order was transmitted to the Commission and
to the parties on August 15, 2000, and the parties were notified of their right
to file exceptions to the Recommended Order with the Commission within 15 days
from the date that the Recommended Order was rendered. Thereafter,
Respondent timely filed
exceptions to the ALJ’s Recommended Order. The Commission Advocate timely filed a response to the
exceptions.
The
Advocate and Respondent entered into a prehearing stipulation which will be
referred to herein as “Stip,” followed by the appropriate page numbers; the
transcript of the DOAH hearing will be referred to herein as “T,” followed by
the appropriate page numbers; the deposition of Lois Benson (a 66-page item
without attached deposition exhibits), jointly offered by Advocate and
Respondent and admitted into evidence by the ALJ, will be referred to herein as
“Benson depo,” followed by the appropriate page numbers; Advocate offered nine
exhibits (described and numbered 1-9 on Advocate’s Pre-Marked Exhibits list),
all but one of which were admitted into evidence, which will be referred to
herein as “AE,” followed by the exhibit number designated on Advocate’s Pre-Marked
Exhibits list and followed by the appropriate page numbers if necessary;
Advocate offered and had admitted into evidence Advocate’s Pre-Marked Exhibits
list itself, which will be referred to herein as “AE 10,” followed by the
appropriate page numbers if necessary; Advocate offered and had admitted into
evidence a transcribed portion of a taped statement of Respondent, which will
be referred to herein as “AE 11,” followed by the appropriate page number if
necessary; Respondent offered and had admitted into evidence two exhibits
(described and numbered 1 and 2 on Respondent’s Pre-Marked Exhibits list),
which will be referred to herein as “RE,”followed by the exhibit number
designated on Respondent’s Pre-Marked Exhibits list and followed by the
appropriate page number if necessary.[1]
Under
Section 120.57(1)(l), Florida Statutes, an agency may not reject or
modify findings of fact made by the ALJ unless a review of the entire record
demonstrates that the findings were not based on competent, substantial
evidence or that the proceedings on which the findings were based did not
comply with the essential requirements of law.
See, e.g., Freeze v. Dept. of Business Regulation, 556 So. 2d
1204 (Fla. 5th DCA 1990); and Florida Department of Corrections v. Bradley,
510 So. 2d 1122 (Fla. 1st DCA 1987).
Competent, substantial evidence has been defined by the Florida Supreme
Court as such evidence as is "sufficiently relevant and material that a
reasonable mind would accept it as adequate to support the conclusions
reached." DeGroot v. Sheffield,
95 So. 2d 912, 916 (Fla. 1957).
The agency
may not reweigh the evidence, resolve conflicts therein, or judge the
credibility of witnesses, because those are matters within the sole province of
the hearing officer. Heifetz v.
Dept. of Business Regulation, 475 So. 2d 1277, 1281 (Fla. 1st DCA
1985). Consequently, if the record of
the DOAH proceedings discloses any competent, substantial evidence to
support a finding of fact made by the ALJ, the Commission is bound by that
finding.
However,
under the Section 120.57(1)(l), Florida Statutes, an agency may reject or
modify conclusions of law over which it has substantive jurisdiction and interpretations
of administrative rules over which it has substantive jurisdiction. When rejecting or modifying such conclusion
of law or interpretation of administrative rule the agency must state with
particularity its reasons for rejecting or modifying such conclusion of law or
interpretation of administrative rule and must make a finding that its
substituted conclusion of law or interpretation of administrative rule is as or
more reasonable than that which was rejected or modified.
Having
reviewed the Recommended Order and the record in this matter, having considered
the exceptions filed by Respondent and the Advocate’s written responses to the
exceptions, and having listened to the arguments of the parties, the Commission
makes the following rulings, findings, conclusions, and recommendations.
RULINGS ON
RESPONDENT'S EXCEPTIONS TO THE
ALJ’S
FINDINGS OF FACT
1. Respondent excepts to finding of fact 5 of
the ALJ's Recommended Order, arguing that the proceeding upon which the finding
is based did not comply with the essential requirements of law and arguing that
the finding is not based on competent substantial evidence. Respondent apparently takes issue with the
ALJ’s denial of his post-hearing Motion To Reopen Record And To Take Judicial
Notice Of Official Actions Of An Executive Department Of The State Of Florida,
whereby he sought to reopen the evidentiary hearing record to add evidence (a
certificate from the Florida Department of State created, disclosed, and
offered well after the conclusion of said hearing) purporting to support the
position that B & W Productions continues in uninterrupted corporate status
from the date of its creation, contrary to the ALJ’s finding that B & W
Productions was administratively dissolved on September 24, 1999, for failure
to file its annual report, arguing that the finding thus reflects only a
portion of the evidence that is sufficiently relevant and material and arguing
that the ALJ’s refusal to reopen the record and take judicial notice of the
reinstatement of the corporate status of B & W Productions is an abuse of
discretion.
This
exception is rejected. As stated by the
Advocate in his Advocate’s Opposition To Respondent’s Motion To Reopen Record
And To Take Judicial Notice, caselaw cited therein, and his response to this
exception, reopening the record in administrative cases is not favored,
Respondent knew well before the evidentiary hearing (see Stip, 2, 12) that the
corporate status of B & W Productions was at issue, the ALJ’s finding is
accurate regardless of the “curative” effects of corporate reinstatement, B
& W Productions’ board or shareholders did not ratify the reinstatement,
and, most importantly, the ALJ’s decision against Respondent is not grounded in
or dependent on any dissolution of the corporate form of B & W Productions;
rather, the ALJ’s decision is based on Respondent’s relationship with the
corporate entity and Respondent’s financial, business, and personal reality
attendant to that relationship. Thus,
there is no abuse of discretion by the ALJ and her denial of Respondent’s
motion and making of the challenged finding of fact complied with the essential
requirements of law. Further, the
finding is supported by competent substantial evidence, including T 17, AE 7,
RE 1.
2. Respondent excepts to finding of fact 24 of
the ALJ’s Recommended Order (that Respondent solicited a sponsorship for his TV
show from Baskerville-Donovan and that the company became a regular sponsor
paying $200 a month from September/October 1998 through April 2000), arguing
that the finding is not based on competent, substantial evidence.
This
exception is rejected. Although it is
apparent from the exception that Respondent would have phrased the finding
differently had he been sitting as ALJ in the case or would have made
additional findings, the finding is based on competent, substantial evidence,
including Stip 9, Benson depo 33-34, T 31, AE 1 at 29, AE 4. Further, the findings that Respondent
apparently would “rearrange” into finding 24 of the ALJ’s Recommended Order
were made in findings of fact 13 and 16 of the ALJ’s Recommended Order.
3. Respondent excepts to finding of fact 35 of
the ALJ’s Recommended Order (that Lois Benson suggested that Respondent contact
DelGallo-Morette as a potential sponsor of Respondent’s TV show; and that both
Respondent and Benson discussed sponsorship of the show with Steve DelGallo,
president of DelGallo-Morette), arguing that the finding is not based on
competent, substantial evidence.
This
exception is rejected. Respondent
agrees with the first sentence of the finding, and the whole of the finding is
supported by competent, substantial evidence, including Stip 9, Benson depo
38. Moreover, in her very next finding
of fact (finding 36), the ALJ elaborates on finding 35 in the manner suggested
by Respondent [in order to note independent private contact and connection
(drawing of house plans by Benson for Mr. DelGallo at no charge) between Benson
and DelGallo].
4. Respondent excepts to finding of fact 47 of
the ALJ’s Recommended Order (that Baskerville-Donovan and Champion made $200
and $260 per month, respectively, sponsorship payments to Respondent’s TV
show), arguing that the finding is not based on competent, substantial
evidence.
This
exception is rejected. The finding is
based on competent, substantial evidence, including Stip 9, T 31, 86, 88, AE
4. Further, Respondent’s exception is
merely an invitation to the ALJ to make additional findings comparing the
companies’ contributions to total production costs of Respondent’s TV show,
findings discernable from a reading of finding 47 in conjunction with finding
of fact 12 of the Recommended Order.
5. Respondent excepts to finding of fact 48 of
the ALJ’s Recommended Order (that Respondent directly benefited from money
received from sponsors of his TV show who regularly did business with and who
regularly appeared before his public agency because the money reduced his
personal contributions and those of his business associate to the show),
arguing that the finding is not based on competent, substantial evidence.
This
exception is rejected. The finding is
supported by competent, substantial evidence, including Stip 9, T 30-36, Benson
depo 31, AE 6. Further, assuming
arguendo that Respondent received no benefit from sponsorship payments made
after March 1999 because “[he] determined that he could not put any more of his
personal funds into B & W Productions of Pensacola, Inc.,” the finding and
the record still support the substance of the ALJ’s determination (that
Respondent was personally benefited monetarily for many months by money payments
from companies doing business with and regularly appearing before the County
Commission for many months of his association with a TV business enterprise).[2]
6. Respondent excepts to finding of fact 49 of
the ALJ’s Recommended Order, apparently taking issue with the ALJ’s reference
to sponsorship payments during the “interim period” between administrative
dissolution of the corporate form of B & W Productions and Respondent’s
transfer of his interest in the business to Lois Benson, in light of his
assertion of the existence and effect of administrative reinstatement of the
corporate form of B & W Productions, essentially repeating his first
exception, including his assertion that finding of fact 5 is not based on
competent, substantial evidence.
This
exception is rejected for the reasons set forth in our ruling above on
Respondent’s first exception and because findings of fact 5 and 49 are based on
competent, substantial evidence, including T 17, 30, AE 4, AE 7, RE 1.
7. Respondent excepts to finding of fact 50 of
the ALJ’s Recommended Order, arguing that the finding is not based on
competent, substantial evidence because the evidence at hearing failed to show
that either Respondent personally or B & W Productions had any dependence
on funds received from the sponsors which were the subject of the hearing and
because the votes of the County Commission (in which Respondent participated)
on matters concerning the sponsors amounted to less than one percent of the
total votes cast by Respondent since July 1998.
This
exception is rejected. Finding of fact 50
is based on competent, substantial evidence, including evidence of Respondent’s
contractual relationship with B & W Productions (Stip 4, 9, T 19, 20, 24,
AE 1 at 2-14 and 80, Benson depo 25); evidence of B & W Productions’
interest in the Lois and Mike Show (Stip 8); evidence that Respondent solicited
funds from businesses regularly appearing before the County Commission (Stip 9,
AE 6); and evidence of Respondent’s and B & W Productions’ dependence upon
sponsorship funds from those same businesses (Stip 9, T 21, 36, Benson depo 26,
31, AE 1 at 262 and 273). Further, to
the extent Respondent asserts in this exception that, as a matter of law, the
relatively minor percentages of votes involving the sponsors mandate a finding
of no conflict under Section 112.313(7)(a), Respondent’s argument is
flawed. Under statutory definition and
caselaw, the finding of a prohibited conflict under Section 112.313(7)(a) is
necessarily rooted in the reality of a given situation. See Section 112.312(8), Florida Statutes, and
Zerweck v. State Comm’n on Ethics, 409 So. 2d 57 (Fla. 4th DCA 1982).[3] In the instant situation, the reality, as
pointed out by the Advocate in his response to Respondent’s exception, is that
the evidence adduced at the DOAH hearing shows that Respondent received a
financial, business, and personal benefit via money paid through sponsorships
he solicited from companies which did business with and regularly appeared
before the County Commission of which he was a member for hundreds of thousands
of dollars worth of approvals after becoming sponsors, is competent and substantial,
and provides a sufficiently relevant and material basis that a reasonable mind
would accept it as adequate to support the determination reached. In addition, inasmuch as Section
112.313(7)(a) is preventive in nature (is designed, as stated in Zerweck,
to address situations which tempt dishonor), inasmuch as the duties of a county
commissioner and the concomitant protection of his objectivity for the public
interest via the statute are not limited to formal voting (but extend, e.g., to
his duty to “speak up” for the people concerning a given county contractor or
contract and not to be pacified by the payments and support of special
interests), and inasmuch as compliance with the voting conflicts law alone will
not cure such situations (see CEO 94-5, Question 1), discussions of voting
percentages ring hollow.
8. Respondent argues that the ALJ’s conclusion
of law 63 (that it is significant and evidentially undisputed that at the time
Respondent solicited sponsorships on behalf of B & W Productions the firms
solicited had on-going contracts with Escambia County, and that the evidence
established that pursuant to agreements between B & W Productions and the
firms many of the sponsorship payments were made to B & W Productions or
BLAB TV just before or after votes were
made on matters affecting the firms) is actually a finding of fact and
excepts to the same, arguing that it is not based on competent, substantial
evidence.
This
exception is accepted as to the finding’s mislabeling as a conclusion of law;
paragraph 63 of the Recommended Order is in substance a finding of fact. Nevertheless, as a finding of fact, it is
supported by competent, substantial evidence, including T 30, 31, 33, 72, 73,
74, 88, 996-98, AE 1 at 12, 29, AE 4, AE 6; thus the evidential assertion of
the exception is rejected. Further,
Respondent’s argument that the finding is “gratuitous and not relevant to the
matter at issue” is not well taken, given the elements and prophylactic purpose
(recognized by the Commission, the judiciary, and the Legislature) of the
statute as discussed earlier in this Final Order And Public Report.
RULINGS ON
RESPONDENT’S EXCEPTIONS
TO THE
ALJ’S CONCLUSIONS OF LAW
1. Respondent excepts to the ALJ’s conclusion of
law 61 (that the clear and convincing evidence at hearing established that
Respondent’s public duty of independence and impartiality was in conflict with
Respondent’s private financial and business interests as it related to B &
W Productions and its production of the Lois and Mike Show), arguing that
Respondent was not a compensated employee regarding the Lois and Mike Show,
arguing that County Commission votes regarding the Show’s sponsors were few in
relation to total County Commission votes during the sponsorship period,[4]
arguing that neither Respondent nor B & W Productions provided any services
to any of the sponsors, arguing that neither the Respondent nor B & W
Productions had any responsibility for evaluating or inspecting the performance
of sponsorship entities under contract with the County, arguing that neither
Respondent nor B & W Productions benefited in any manner from the votes of
the County Commission involving the sponsorship entities, arguing that
Respondent transferred all of his interest in B & W Productions to Lois
Benson free and clear of any obligation of repayment, and thus arguing that
Respondent’s duty of independence and impartiality as a County Commissioner was
not in conflict with his private financial interests.
This
exception is rejected. The ALJ’s
determination that Respondent’s private financial and business interests
relative to B & W Productions and its production of the Lois and Mike Show
were in conflict with his duty of independence and impartiality as a County
Commissioner is supported by the facts of this matter and is in accord with
caselaw and the statutory definition of conflict of interest. Respondent, by focusing on the “employment”
element of Section 112.313(7)(a), ignores the alternative element of a
“contractual relationship” (clearly established between Respondent and B &
W Productions in this matter) and ignores the financial and business reality of
Respondent’s situation [a situation in which Respondent was able to keep his
personal wallet partially closed due to the effects of money payments from
companies doing business with the County Commission (Respondent’s public
agency)]. Further, this business and
financial reality and its conflict with Respondent’s duty to remain independent
and impartial as a County Commissioner regarding the sponsors interfacing with
the County Commission is grounded in the second clause of the statute, not in
the first clause, as is suggested by Respondent’s reference in this exception
to Respondent’s and B & W Productions’ not providing any private services
to the sponsors who were interfacing with the County Commission via contracts
and appearances. In addition, the lack
of inurement of a benefit to Respondent or B & W Productions from votes of
the County Commission is irrelevant to a violation of Section 112.313(7)(a), a
preventive statute which, unlike the voting conflicts law of Section
112.3143(3)(a), Florida Statutes, is not predicated on actual misconduct. As recognized by the District Court in Zerweck,
it is sufficient that in a given situation the public and private interests
“coincide to create a situation which ‘tempts dishonor’.” Id., at 61. Indeed it is difficult to envision a scenario more amenable to
the application of the statute than the instant situation, a state of affairs
in which a sitting County Commissioner’s private business endeavor was
monetarily subsidized by the funds of companies with major business interests
before his public agency. Also,
assuming arguendo that Respondent’s transfer of interests in B & W
Production to Lois Benson divorced him from all financial reality regarding the
TV Show and its sponsors, the Respondent’s interest in the TV Show and its
sponsorship by the County-interfaced companies existed for a substantial period
of time.
2. Respondent excepts to the portion of the
ALJ’s conclusion of law 62 that states that B & W Production’s sole
source of revenue was derived from sponsors, arguing that the conclusion is
contrary to the ALJ’s finding of fact 12 which states that the primary
source of money to pay for the Lois and Mike Show came from sponsors; and
excepts to the ALJ’‘s determination that Respondent successfully solicited
sponsorships for B & W Productions from firms who did business with and
regularly appeared before the County Commission, arguing that many persons and
entities other than the County-interfaced firms also were solicited.
This
exception is rejected. As pointed out
by the Advocate in his response to the exceptions, conclusion of law 62
actually is a finding of fact. As such,
paragraph 62 of the Recommended Order is in harmony with the record and is
supported by competent, substantial evidence, including T 21. Further, Respondent’s argument regarding the
total number of solicitations is merely an invitation to the ALJ to make
additional findings, and it is not the Commission’s function to reweigh the
evidence as long as there is competent, substantial evidence to support the
ALJ’s findings as there is here.
Inasmuch as the ALJ fulfilled her function of weighing the evidence,
judging the credibility of witnesses, and drawing permissible inferences from
the evidence, we are not free to supplement her findings. As the Court stated in Manasota 88, Inc.
v. Tremor, 545 So. 2d 439 (Fla. 2d DCA 1989):
Agency
fact-finding independent of and supplementary to D.O.A.H. proceedings has been
specifically disapproved. See e.g.
Friends of Children v. Department of Health and Rehabilitative Services,
504 So 2d 1345 (Fla. 1st DCA 1987).
3. Respondent excepts to
the ALJ’s conclusion of law 63 for the reasons set forth in exception 8. This exception is rejected for the reasons
set forth in our rejection of exception 8, which are incorporated by reference
in this rejection.
The findings of fact set forth in the ALJ’s Recommended Order
are approved, adopted, and incorporated herein by reference, regardless of
whether they be labeled as findings of fact or as conclusions of law.
1. The conclusions of law
set forth in the ALJ’s Recommended Order also are approved, adopted, and
incorporated herein by reference, irrespective of their positioning or labeling
in the Recommended Order; and
2. Accordingly, the Commission on Ethics
concludes that the Respondent, as a member of the Escambia County Commission,
violated Section 112.313(7)(a), Florida Statutes, by having or holding a
contractual relationship with B & W Productions of Pensacola, Inc. which
created a continuing or frequently recurring conflict between his private
interests and the performance of his public duties, due to financial support of
his television show business endeavor by companies doing business with or
regularly appearing before the County Commission. Further, in accord with the ALJ’s Recommended Order, the
Commission on Ethics concludes that the Respondent did not violate Section
112.3143(3)(a), Florida Statutes, and hereby dismisses the allegations under
Section 112.3143(3)(a).
The ALJ’s
recommendation of $2,000.00 as a civil penalty for Respondent’s violation of
Section 112.313(7)(a), Florida Statutes, is accepted. Likewise, her recommendation that the
Commission recommend that a public censure and reprimand be issued to the
Respondent also is accepted.
In
consideration of the foregoing and pursuant to Sections 112.317 and 112.324,
Florida Statutes, the Commission recommends that the Governor impose a civil
penalty upon the Respondent, DAVID WHITEHEAD, in the total amount of $2,000.00,
and that he receive a public censure and reprimand.
ORDERED by
the State of Florida Commission on Ethics meeting in public session on November
17, 2000.
____________________________
Date Rendered
_______________________________
Howard Marks
Chair
THIS ORDER
CONSTITUTES FINAL AGENCY ACTION. ANY PARTY WHO IS ADVERSELY AFFECTED BY THIS
ORDER HAS THE RIGHT TO SEEK JUDICIAL REVIEW UNDER SECTION 120.68, FLORIDA
STATUTES, BY FILING A NOTICE OF ADMINISTRATIVE APPEAL PURSUANT TO RULE 9.110
FLORIDA RULES OF APPELLATE PROCEDURE, WITH THE CLERK OF THE COMMISSION ON
ETHICS, 2822 REMINGTON GREEN CIRCLE, SUITE 101, P.O. DRAWER 15709, TALLAHASSEE,
FLORIDA 32317-5709; AND BY FILING A COPY OF THE NOTICE OF APPEAL ATTACHED TO
WHICH IS A CONFORMED COPY OF THE ORDER DESIGNATED IN THE NOTICE OF APPEAL
ACCOMPANIED BY THE APPLICABLE FILING FEES WITH THE APPROPRIATE DISTRICT COURT
OF APPEAL. THE NOTICE OF ADMINISTRATIVE APPEAL MUST BE FILED WITHIN 30 DAYS OF
THE DATE THIS ORDER IS RENDERED.
cc: Mr. Mark Herron,
Attorney for Respondent
Mr. Gary Early, Attorney for
Respondent
Mr. James H.
Peterson, III, Commission Advocate
Mr. Thomas M. Garner, Complainant
The Honorable Carolyn S. Holifield,
Administrative Law Judge
Division of Administrative Hearings
[1]The Index Of
Exhibits appearing at the beginning of the Transcript of the DOAH hearing
misidentifies AE1 as the deposition of Lois Benson and misidentifies RE2 as the
deposition of Lois Benson. In fact, AE1
is a composite exhibit which consists of various exhibits attached to Ms.
Benson’s deposition at the time of deposition, RE2 is exhibit 5 attached to the
deposition, and the deposition of Lois Benson (testimony only, without
deposition exhibits) is the joint exhibit (referred to herein as “Benson
depo”).
[2]Also,
Respondent’s unilateral determination that he could put no more of his personal
funds into B & W Productions does not negate the personal importance to him
of sponsor payments after his closure of his wallet, given that his transfer of
his interest in B & W to Lois
Benson did not take place until eight months after his personal belt
tightening. See findings of fact 8 and
15 of the Recommended Order.
[3]The statutory
definition provides that “[c]onflict or conflict of interest means a situation
in which regard for a private interests tends to lead to disregard of a public
duty or interest.”
[4]Essentially a
restatement of Respondent’s argument in exception 7.