Capeletti Bros., Inc. v. State, Dept. of Transp., KK-195

• Decision Date: 09 August 1978
• Docket Number: No. KK-195,KK-195
• Citation: 362 So.2d 346
• Parties: CAPELETTI BROTHERS, INC., Appellant, v. STATE of Florida, DEPARTMENT OF TRANSPORTATION, Appellee.
• Court: Florida District Court of Appeals

Page 346

362 So.2d 346

CAPELETTI BROTHERS, INC., Appellant, v. STATE of Florida, DEPARTMENT OF TRANSPORTATION, Appellee.

No. KK-195.

District Court of Appeal of Florida, First District.

Aug. 9, 1978.

Rehearing Denied Sept. 13, 1978.

R. Earl Welbaum of Welbaum, Zook, Jones & Williams, Miami, and Kenneth G. Oertel of Truett & Oertel, P. A., Tallahassee, for appellant.

Alan E. DeSerio, John J. Rimes, III, and H. Reynolds Sampson, Tallahassee, for appellee.

SMITH, Acting Chief Judge.

Again an agency of the state has entered an order purporting to affect the substantial rights of a party without complying with Section 120.57, Florida Statutes (1977). See General Development Corp. v. Div. of State Planning, 353 So.2d 1199, 1209 (Fla. 1st DCA 1978). Again it is the Department of Transportation. See Couch Construction Co., Inc. v. Department of Transportation, 361 So.2d 172, 175, Nos. II-314 and KK-100 361 So.2d 184 (Fla. 1st DCA 1978), opinions filed June 16, 1978. Again we reverse.

Capeletti, holder of a DOT certificate of qualification to bid on construction work to be let by DOT, was served March 29, 1978, with a DOT preliminary notice of delinquency on a prior state job. On May 5, following a response by Capeletti, DOT sent a telegram and letter advising that Capeletti's certificate was suspended for delinquency. On June 16, following other correspondence from Capeletti, DOT wrote another letter refusing to lift the suspension and refusing to stay the effect of its action pending a Section 120.57(1) hearing on the disputed fact of delinquency. DOT's action thus purports to disqualify Capeletti to bid on other DOT jobs during the indefinite period of the suspension.

Section 337.16, Florida Statutes (1977), provides:

(1) No contractor shall be qualified to bid when an investigation by the highway engineer discloses that such contractor is delinquent on a previously awarded contract, and in such case his certificate of qualification shall be suspended or revoked.

(2) The department may suspend, for a specified period of time, or revoke for good cause any certificate of qualification.

(3) Any person found delinquent on a contract or whose certificate is revoked or suspended shall be given the same benefit of hearing as provided in the case of a person refused an original certificate.

Proceedings under Section 337.16 for revocation of a contractor's certificate of qualification are in effect license revocation proceedings cognizable under Sections 120.52(7) and 120.60. Any inconsistent DOT procedures under Sections 337.15-.16, or under rules implementing those statutes, are replaced by Section 120.60, providing in part:

(1) Unless otherwise provided by statute enacted subsequent to the effective date of this act, licensing is subject to the provisions of s. 120.57.

Section 120.57 and Section 120.59 contemplate entry of an order of certain characteristics upon completion of Section 120.57(1) or (2) proceedings. Those statutes were not satisfied by DOT's sundry letters advising Capeletti of its intended action and of its decision to suspend Capeletti's certificate of qualification. DOT does not plausibly contend that its correspondence satisfied the procedural requirements of Chapter 120. DOT urges instead that, under its rules, Section 120.57 proceedings are in the nature of an appeal from its decision reached in the free-form proceedings characterized by its exchange of correspondence with Capeletti. More particularly, DOT urges that its decision to suspend Capeletti's certificate is immediately effective, although Section 120.57 proceedings are now in progress, unless Capeletti posts a $216,000 bond to pay delay damages on pending contract awards. That argument is unfounded. In license revocation proceedings, as in other proceedings affecting a party's substantial interests, an adverse determination of a party's substantial interests is ineffective until an order has properly been entered pursuant to Section 120.59, after proceedings under Section 120.57. The only exception to that rule in license revocation proceedings is for prevention of "immediate serious danger to the public health, safety, or welfare." Section 120.60(6). DOT does not contend that such an emergency exists.

DOT's Rule 14-23.01(4)(a), Fla.Admin.Code, provides that, following a preliminary and final notice of delinquency, the affected contractor may "appeal" and have a hearing under Section 120.57(1) or (2). That rule provides:

(a) Appeals. Substantially affected parties have the right to request a hearing under 120.57 FS.

DOT thus chooses to "plow the same ground twice," once in free-form proceedings here characterized by summary correspondence, and again by Section 120.57(1) or (2) proceedings. An agency may find it convenient to integrate the two processes, see McDonald v. Department of Banking and Finance, 346 So.2d 569, 578 n. 5 (Fla. 1st DCA 1977), but that is not required. "Free-form" proceedings are nothing more than the necessary or convenient procedures, unknown to the APA, by which an agency transacts its day-to-day business. See H. Levinson, Elements of the Administrative Process, 26 Amer.L.Rev. 872, 880, 926 et seq. (1977). ¹ Without summary letters, telephone calls, and other conventional communications, the wheels of government would surely grind to a halt. The vast majority of an agency's free-form decisions become conclusive because they are not challenged in Section 120.57(1) or (2) proceedings. Yet the agency's rules must clearly signal when the agency's free-form decisional process is completed or at a point when it is...