Continental Const. Co. v. Board of Trustees of Internal Imp. Trust Fund, AZ-119

• Decision Date: 18 February 1985
• Docket Number: No. AZ-119,AZ-119
• Parties: 10 Fla. L. Weekly 443 CONTINENTAL CONSTRUCTION CO., Appellant, v. BOARD OF TRUSTEES OF the INTERNAL IMPROVEMENT TRUST FUND, Appellee.
• Court: Florida District Court of Appeals

Page 204

464 So.2d 204

10 Fla. L. Weekly 443

CONTINENTAL CONSTRUCTION CO., Appellant, v. BOARD OF TRUSTEES OF the INTERNAL IMPROVEMENT TRUST FUND, Appellee.

No. AZ-119.

District Court of Appeal of Florida,

First District.

Feb. 18, 1985.

J. Kendrick Tucker and William L. Hyde of Akerman, Senterfitt & Eidson, Tallahassee, for appellant.

John W. Williams, Asst. Gen. Counsel, Dept. of Natural Resources, Tallahassee, for appellee.

ERVIN, Chief Judge.

Continental Construction Company (Continental) appeals from a final order of the Board of Trustees of the Internal Improvement Trust Fund of the State of Florida (Board), assessing a penalty against Continental for the unauthorized use of sovereignty submerged lands, entered pursuant to Florida Administrative Code Rule 16Q-21.11(1)(1)2. Appellant argues that the Board's assessment of the penalty is erroneous because the Board has not been legislatively delegated the power to impose penalties; therefore the penalty is contrary to the provisions of Article I, Section 18 of the Florida Constitution, prohibiting administrative penalties in the absence of specific legislative authorization. We agree and reverse. ¹

On December 6, 1977, the Board approved the use of 25,047 square feet of sovereignty submerged lands located in Blind Pass, Boca Ciega Bay, Pinellas County, for the installation of a docking facility by Barnes Mortgage Investment Trust, predecessor in interest to Continental. All of the necessary state, local, and federal agency permits were obtained for the construction of the 46 boat slips and attendant docks. Before construction of the final 17 of the original 46 slips was completed, Continental determined to build additional slips on two larger T-docks at the same location.

In June of 1979, Continental, through its engineer, filed an application with the Department of Environmental Regulation (DER) to build the two additional docks, requiring a lease of an additional 75,568 square feet of sovereignty submerged lands. Continental then applied for and received a permit from the Corps of Engineers, and a water and navigation control permit from Pinellas County. On February 12, 1980, Continental, mistakenly believing that all required documentation had been supplied for the additional docks, began construction on the T-shaped docks, thereby expanding the docking facility without the Board's prior authorization. Continental thereafter sought an after-the-fact lease expansion permit from the Board, which was granted, but the Board also assessed the sum of $32,242.24 against Continental for its unauthorized use of sovereignty submerged lands, pursuant to Rule 16Q-21.11(1)(1).

The Board's assessment, authorized by Rule 16Q-21.11(1)(1), includes:

1. Payment of retroactive lease fees;

2. Payment of an assessment computed as the number of square feet in the lease area times the lease fee per square foot at the time construction was commenced times ten; and,

3. Payment of an additional annual percentage on retroactive lease fees and on the assessment calculated under 2., computed at a rate of 12%. Such rate shall be adjusted annually to a rate equal to the two percentage points above the Federal Reserve Bank discount rate to member banks.

At issue here is the constitutionality of only the penalty assessment provision under Rule 16Q-21.11(1)(1)2. We are not confronted with, and therefore we do not address, any question of whether the Board illegally assessed retroactive lease fees. Article I, Section 18 of the Florida Constitution provides:

No administrative agency shall impose a sentence of imprisonment, nor shall it impose any other penalty except as provided by law.

The Board argues that rule 16Q-21.11(1)(1)2 does not violate Article I, Section 18 of the Florida Constitution for two reasons: (1) The rule is a remedial provision designed to effect restitution and thus not a penalty proscribed by Article I, Section 18; and (2) even if rule 16Q-21.11(1)(1)2 imposes a penalty, Chapter 253, Florida Statutes provides broad authority to the Board for the exercise of such powers. We disagree on both points and find the rule violates the provision in question of the Florida Constitution.

Addressing the Board's first argument, we find that the Board has assessed against Continental the payment in part of retroactive lease fees, pursuant to rule 16Q-21.11(1)(1)1, allowing restitution to the state for the improper use of sovereign submerged lands. Clearly, that part of the Board's assessment, as authorized by rule 16Q-21.11(1)(1)2, which is computed on the basis of "the number of square feet in the lease area times the lease fee per square foot at...