Choice Plus, LLC v. Department of Financial Services, etc. , 244 So. 3d 343 ( 2018 )

FIRST DISTRICT COURT OF APPEAL
STATE OF FLORIDA
_____________________________
No. 1D15-3184
_____________________________
CHOICE PLUS, LLC,
Appellant,
v.
DEPARTMENT OF FINANCIAL
SERVICES, BUREAU OF
UNCLAIMED PROPERTY; BENGT
ROLAND DAHLQVIST, ANN-
KRISTIN DAHLQVIST BERLIN,
BARBRO BRITT MARIE LINDEN
BARKMAN, BERT ERIK GORE
LINDEN, CARL JOHAN TEGGE,
MALIN CAROLINE CHARLOTTE
TEGGE, LARS RAGNER LINDEN,
GUNVOR MARIE LINDEN WILHDE,
MARIANNE ELISABETH LINDEN
HOLM, and ANITA MARGARETHA
NYBERG,
Appellees.
_____________________________
On appeal from the Department of Financial Services.
Robert C. Kneip, Chief of Staff.
April 17, 2018
ROBERTS, J.
Choice Plus, LLC (Choice Plus), appeals a final order from the
Department of Financial Services (the Department) denying its
claim to recover funds from the estate of Mrs. Inez Eleanor Rigley
that were being held by the Department. Choice Plus argues the
Department improperly ignored a valid order from the Pinellas
County Probate Court and made its own de novo determination
regarding entitlement to the estate funds. We agree with Choice
Plus that the Department overstepped its authority and reverse
the final order.
Facts
In 2005, Mrs. Rigley died in St. Petersburg, Florida. In 2007,
the Pinellas County Probate Court determined that Mrs. Rigley
died intestate, having no known beneficiaries. The probate court
ordered “[t]hat under [section 732.107, Florida Statutes (2007)] the
assets of the estate shall escheat to the State of Florida.” Per
section 732.107(2), Mrs. Rigley’s real property was sold as provided
in the Florida Probate Rules, and the proceeds were paid to the
Chief Financial Officer for deposit into the State School Fund. The
Department documented receipt of $98,185.79 in cash proceeds
from Mrs. Rigley’s estate and marked it as an “escheated estate.”
Section 732.107(3) provides,
At any time within 10 years after the payment to the
Chief Financial Officer, a person claiming to be entitled
to the proceeds may reopen the administration to assert
entitlement to the proceeds. If no claim is timely
asserted, the state’s rights to the proceeds shall become
absolute.
In 2013, before the ten-year deadline expired, Choice Plus
took such action. Choice Plus is a private investigative agency
registered with the Department as a claimant’s representative.
Choice Plus first petitioned the probate court to determine that ten
individuals 1 (hereinafter the ten claimants), all of whom resided in
1 Bengt Roland Dahlqvist, Ann-Kristin Dahlqvist Berlin,
Barbro Britt Marie Linden Barkman, Bert Erik Gore Linden, Carl
Johan Tegge, Malin Caroline Charlotte Tegge, Lars Ragner
2
Sweden, were Mrs. Rigley’s beneficiaries. Attached to the petition
to determine beneficiaries was a family genealogical chart as well
as a researcher’s report that included thirty-three endnotes
referencing various records like death and birth records. 2 Choice
Plus also petitioned the probate court to reopen the estate for
administration and to declare the ten claimants were entitled to
the funds deposited with the State. The Department was not a
party to the probate proceedings; however, Choice Plus did notice
the Attorney General’s Office as required by section 733.816(3),
Florida Statutes, which did not file any objections.
In two 2013 orders, the probate court reopened the estate;
determined that the ten claimants were indeed beneficiaries of
Mrs. Rigley’s estate; delineated the share of her estate each
claimant was owed; and ordered that “after providing for payment
of costs and fees, the State of Florida is hereby authorized and
directed to pay the funds it holds on behalf of the Estate of [Mrs.
Rigley]” to the ten claimants in the proportions set out in the
court’s order. As the claimants’ representative, Choice Plus stood
to receive $21,500.53 in fees when the estate funds were paid.
Choice Plus then filed with the Department a claim on behalf
of each of the ten claimants, seeking payment of each claimant’s
portion of Mrs. Rigley’s estate funds. The claim was submitted on
the Department’s required form and attached the required copies
of the government-issued, photographic identification of the ten
claimants as well as certified copies of the probate court order
demonstrating the ten claimants’ entitlement to the estate funds.
Choice Plus later submitted Mrs. Rigley’s death certificate. Choice
Plus also filed limited powers of attorney for it to act on behalf of
each claimant.
Linden, Gunvor Maria Linden Wilhde, Marianne Elisabeth Linden
Holm, and Anita Margaretha Nyberg.
2 Copies of the documents listed in the thirty-three endnotes
are not included in the record on appeal. It is not wholly clear
whether or not all of these documents were filed in the probate
court.
3
In 2014, the Department issued a Notice of Intent to deny the
claim (without prejudice) as incomplete because it did not include
the appropriate documents in Florida Administrative Code Rule
69I-20.0022(3)(b) (2014) 3 to connect the ten claimants to Mrs.
Rigley. In essence, the Department took the position that the
genealogic charts and researcher’s report that had been relied
upon by the probate court were too ambiguous to demonstrate the
ten claimants were entitled to disbursement of Mrs. Rigley’s estate
funds. The Department concluded as custodian of the estate funds
under The Florida Disposition of Unclaimed Property Act, chapter
717, Florida Statutes, it had authority to determine the merits of
each claim for funds, and the claim as submitted failed to meet the
burden of establishing entitlement to Mrs. Rigley’s estate funds by
a preponderance of the evidence.
Over the next two years, the parties disputed the
Department’s ability to deny the claim under chapter 717. The
issues condensed into a purely legal question that was ultimately
decided in the Department’s 2015 final order on appeal. In its final
order, the Department concluded that it had been vested with the
sole jurisdiction to administer chapter 717 and to determine the
merits of each claim for funds held in the State Treasury. The
Department rejected Choice Plus’s contention that it was under a
ministerial duty to disburse the estate funds upon receipt of the
probate court’s order. Instead the Department determined that,
despite the probate court’s previous determination of entitlement,
Choice Plus had failed to meet its burden of demonstrating
entitlement to the Department by submitting the “appropriate
3 Rule 69I-20.0022 provides in relevant part,
(1) Any and all persons filing a claim for unclaimed
property have the burden to provide to the Department a
preponderance of evidence to prove ownership and
entitlement to such property being claimed[.]
For claims by beneficiaries or estates, subsection (3)(b) directs
the claimant to provide “appropriate documentation to connect the
claimant to the deceased apparent owner.”
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documentation” connecting the individual claimants to Mrs. Rigley
by a preponderance of the evidence. Choice Plus appeals the final
order, arguing the Department overstepped its authority. We
agree.
Standard of Review
As this case presents a purely legal issue, our review is de
novo. Kale v. Dep’t of Health, 175 So. 3d 815, 817 (Fla. 1st DCA
2015); see also § 120.68(7), Fla. Stat. (2013) (providing that a court
shall remand a case or set aside an agency action when it finds
that the agency “has erroneously interpreted a provision of law and
a correct interpretation compels a particular action”). While an
agency’s interpretation of a statute that it is charged with
administering is entitled to greater deference and will not be
reversed unless clearly erroneous, deference is not warranted
when the agency’s interpretation conflicts with the plain meaning
of the statute. Kale, 175 So. 3d at 817.
Escheated Funds or Unclaimed Funds
The Department’s final order rejected Choice Plus’s attempt
to draw a “semantic distinction” between escheated funds and
unclaimed funds, finding it was a distinction without a difference
in the context of this case. We disagree as the distinction is the
difference under the facts of this case.
As aforementioned, Mrs. Rigley’s estate funds were
transferred to the Department through the escheat process in the
Probate Code, section 732.107, Florida Statutes (2007). In 2007,
when the probate court determined that Mrs. Rigley died intestate,
her estate “escheated” to the State. § 732.107(1), Fla. Stat. (2007)
(“When a person dies leaving an estate without being survived by
any person entitled to a part of it, that part shall escheat to the
state.”). Black’s Law Dictionary (10th ed.) defines “escheat,” as
“[r]eversion of property (esp. real property) to the state upon the
death of an owner who has neither a will nor any legal heirs.”
Thus, unlike unclaimed funds, Mrs. Rigley’s estate funds passed
directly from her ownership to the ownership of the State. After a
ten-year period, the State’s ownership would become absolute with
no other action taken so long as no purported beneficiaries had
come forward. § 732.107(3), Fla. Stat. (2007).
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The term “unclaimed property” is not defined in chapter 717.
In Crescenzo v. Atwater (In re Order Directing Payment of
13,857.69), 136 So. 3d 1248 (Fla. 2d DCA 2014), the Second DCA
examined the interplay between chapter 717 and “unclaimed
funds” from judicial proceedings that are deposited with the Chief
Financial Officer to the credit of the State School Fund pursuant
to section 43.19, Florida Statutes (2011). The Court drew a
distinction between section 43.19 funds and other unclaimed funds
in chapter 717, stating,
Unlike section 43.19, [chapter 717] is not intended to
address a narrow subset of unclaimed property but rather
to provide broader substantive and administrative law
addressing all varieties of unclaimed property. Thus, for
example, it has procedures for unclaimed bank accounts,
utility deposits, and life insurance proceeds. §§ 717.106–
.07, 108. Similar to funds deposited under section 43.19,
the funds deposited under chapter 717 often end up in the
State School Fund. See § 717.123. The fact that the funds
end up in the same account, however, does not mean that
they must only be removed from that fund using the same
procedures.
136 So. 3d at 1254-55.
We regard the section 732.107 funds here in the same manner.
The fact that section 732.107 funds are addressed within the ambit
of chapter 717 does not mean that they lose their distinct character
and become subject to the entirety of chapter 717. The
Department’s argument disregards the nature of these funds and
simply assumes that because they are deposited with the Chief
Financial Officer, the funds are subject to all of chapter 717.
Putting oranges and apples into one large bowl does not make
them all oranges.
We disagree that the Legislature intended section 732.107
funds to be treated in the same manner as all other “unclaimed
property.” With regard to much of the “unclaimed property” in
chapter 717, the Department’s role is as a custodian pending
expiration of a dormancy period. See, e.g., § 717.104, Fla. Stat.
(2013) (outstanding traveler’s checks presumed “unclaimed” after
fifteen years); § 717.106, Fla. Stat. (2013) (certain bank accounts
6
presumed “unclaimed” after a period of inaction for five years); §
717.115, Fla. Stat. (2013) (unpaid wages that have not been
claimed for more than one year are presumed “unclaimed”). The
Department also receives funds from Florida Clerks of Courts as
the result of various judicial processes. See, e.g., § 45.032, Fla.
Stat. (2013) (detailing the process for surplus judicial funds, which
may become “unclaimed property to be deposited with the Chief
Financial Officer pursuant to chapter 717”). One obvious
difference between the aforementioned “unclaimed” funds and the
section 732.107 funds is the section 732.107 funds are never
referred to as “unclaimed.” While section 732.107 funds may be
unclaimed in a colloquial sense, the fact that they escheat to the
State upon a determination of intestacy means that the funds are
never without an identifiable or locatable owner like other forms
of “unclaimed” property in chapter 717. This is not a distinction
without a difference.
The Department’s Authority
The view that escheated funds are a distinct subset of
“unclaimed funds” as that term is generally used in chapter 717 is
confirmed by the fact that the only reference to section 732.107 in
chapter 717 is in section 717.124. Section 717.124 details the
process for filing a claim for unclaimed property, which includes
the requirement to file the claim on the prescribed claim form and
the requirement to include a copy of a government-issued,
photographic identification. § 717.124(1), Fla. Stat. (2013).
Notably, section 717.124 does not include any requirement that
the claimant independently prove entitlement to the funds to the
Department. Section 717.124(8) provides,
This section applies to all unclaimed property reported
and remitted to the Chief Financial Officer, including, but
not limited to, property reported pursuant to ss. 43.19,
45.032, 732.107, 733.816, and 744.534.
(Emphasis added.)
The plain statutory language is clear that only section 717.124
applies to section 732.107 funds. The Department cannot point to
any statutory language stating the entirety of chapter 717 applies
to section 732.107 funds. The specific use of the term “section” as
7
opposed to chapter means that only section 717.124 applies to
funds transferred pursuant to section 732.107. See Maggio v. Fla.
Dep’t of Labor & Employment Security, 899 So. 2d 1074, 1080 (Fla.
2005). Indeed, if the entirety of chapter 717 applied to funds
transferred under section 732.107, then the language in section
717.124(8) would be redundant and meaningless. State v. Goode,
830 So. 2d 817, 824 (Fla. 2002) (“In addition to the statute’s plain
language, a basic rule of statutory construction provides that the
Legislature does not intend to enact useless provisions, and courts
should avoid readings that would render part of a statute
meaningless.”).
The Department’s error here lies in presuming the estate
funds are subject to all of chapter 717. Simply because Choice Plus
had to file an “Unclaimed Property Claim” under section 717.124
in order to have the Department disburse Mrs. Rigley’s estate
funds does not make the estate funds themselves “unclaimed” and
subject to all provisions of chapter 717. The Department’s error in
interpreting section 717.124(8)’s narrow provision as subjecting
the estate funds to all of chapter 717 caused it to apply the wrong
standards and improperly deny the claim.
Chapter 717 gives the Department a panoply of tools in order
to determine the merits of a claim of ownership to “unclaimed
property” that come to the Department through various means.
See, e.g., § 717.1244, Fla. Stat. (2013) (“In rendering a
determination regarding the merits of an unclaimed property
claim, the department shall rely on the applicable statutory,
regulatory, common, and case law.”); § 717.1301, Fla. Stat. (2013)
(the Department has the authority to make investigations and
examinations to enforce chapter 717); § 717.1341, Fla. Stat. (2013)
(“No person shall receive unclaimed property that the person is not
entitled to receive.”); § 717.126, Fla. Stat. (2013) (“[T]he burden
shall be upon the claimant to establish entitlement to the property
by a preponderance of the evidence. Having the same name as that
reported to the department is not sufficient, in the absence of other
evidence, to prove entitlement to unclaimed property.”). However,
Crescenzo properly recognized that simply because funds often end
up in the same account does not mean that they must be removed
from that account in the same manner. Crescenzo, 136 So. 3d at
8
1255 (distinguishing section 43.19 funds from other chapter 717
funds).
While the Department’s duty to determine the merits of a
claim makes sense with regard to its role as custodian over certain
types of “unclaimed property,” it does not make sense to apply the
panoply of tools in chapter 717 to funds that escheat to the State
under section 732.107. Escheat funds revert to the State after the
probate court determines there are no beneficiaries. If potential
beneficiaries wish to come forward, they do not go directly to the
Department, but must first go to the probate court, which has
jurisdiction over administration of the estate for a determination
on entitlement. If the probate court determines the beneficiaries
are entitled, it orders the Department to disburse the estate funds
in the appropriate proportions. The oversight of the probate court
means there is no need for the Department to independently
determine whether the beneficiaries are entitled to the estate
funds. The Department’s interpretation of chapter 717 as
requiring a second, independent determination of entitlement
renders the probate court’s function meaningless.
The Department takes the position that, as custodian of the
estate funds in its possession, it had more than a ministerial duty
to disburse the estate funds upon receipt of the proper claim form,
government identification, and probate court orders. Rather, the
Department references its duty to “determine the merits of the
claims.” Section 717.1242(1), Florida Statutes (2013), provides,
It is and has been the intent of the Legislature that,
pursuant to s. 26.012(2)(b), circuit courts have
jurisdiction of proceedings relating to the settlement of
the estates of decedents and other jurisdiction usually
pertaining to courts of probate. It is and has been the
intent of the Legislature that, pursuant to s. 717.124, the
department determines the merits of claims for property
paid or delivered to the department under this chapter.
Consistent with this legislative intent, any estate or
beneficiary, as defined in s. 731.201, of an estate seeking
to obtain property paid or delivered to the department
under this chapter must file a claim with the department
as provided in s. 717.124.
9
See also Atwater v. City of Cape Coral, 120 So. 3d 595, 599 (Fla. 2d
DCA 2013) (holding once surplus judicial funds were transferred
to the Chief Financial Officer, the provisions of section 45.032
provided that the surplus funds became unclaimed property
controlled by chapter 717, such that under section 717.1242 the
Chief Financial Officer and the Department alone had the
authority to make the final determination as to the disposition of
the unclaimed funds).
We do not disagree that the Department carries a
responsibility to ensure that funds are properly disbursed to the
rightful owner. Unlike the funds in City of Cape Coral, here there
is no explicit reference to chapter 717 in section 732.107. Compare
§ 45.032(4), Fla. Stat. (2013) (“Thirty days after termination of the
appointment of the surplus trustee, the clerk shall treat the
remaining funds as unclaimed property to be deposited with
the Chief Financial Officer pursuant to chapter 717”) with §
732.107(2), Fla. Stat. (2013) (“ Property that escheats shall be sold
as provided in the Florida Probate Rules and the proceeds paid to
the Chief Financial Officer of the state and deposited in the State
School Fund.”). We also find the Department’s reliance on Bondi
v. Brito, 159 So. 3d 369 (Fla. 2d DCA 2015), inapplicable to the
instant case as Bondi was limited to the authority of the circuit
court to order the Chief Financial Officer to appear at circuit court
proceedings relating to Chief Financial Officer’s declination to
disburse funds received under section 43.19, Florida Statutes,
despite the circuit court’s order to do so. Bondi specifically
provided, “We take no position regarding the validity or legitimacy
of the circuit court's orders regarding entitlement to or transfer of
the unclaimed funds.” Id. at 373.
We do not read section 717.1242(1) as giving the Department
independent jurisdiction over the merits of section 732.107 funds.
Rather, section 717.1242 confirms that the probate court has
jurisdiction to determine entitlement to the estate. This is clear in
the plain language of section 732.107(3), which directs a party
claiming entitlement to first go to the probate court to “reopen the
administration and assert entitlement to the proceeds.” See also
Fla. Admin Code R. 69I-44.021(1) (“Petitions for funds held
pursuant to [section 737.102] are to be filed initially with the court
that directed the deposits of the funds with the Chief Financial
10
Officer.”). 4 The Department has no basis to interpret its duty to
determine the “merits” here to include a second determination of
entitlement or an appellate-like review of the probate court’s
decision.
The Department ignored the probate court’s orders finding the
ten claimants were each entitled to a particular portion of Mrs.
Rigley’s estate. Instead, the Department rejected the probate
court’s finding and required Choice Plus to again present evidence
of entitlement, despite the fact that the evidence had already been
accepted and ruled upon by the probate court. Such action
amounted to a wholesale rejection of the probate court’s orders in
contravention to section 732.107(3). If the Department had the
ability to make an independent determination on entitlement of
escheated funds, it would render the need to first petition the
probate court meaningless. See Goode, 830 So. 2d at 824.
The Department’s reading also raises separation of powers
concerns. The probate court’s order was binding on the
Department. Under Article V, section 20(c)(c) circuit courts have
jurisdiction pertaining to courts of probate. The Department
overstepped its authority by interpreting section 717.124 in such a
way as to allow it to readjudicate the issue of entitlement in
contravention to the probate court’s order. This was error and
resulted in a final order that exceeded the Department’s authority
by rejecting an order of an Article V court. See Canney v. Bd. of
Public Instruction of Alachua Cty., 278 So. 2d 260, 262 (Fla. 1973)
(“As a general rule administrative agencies have no general
judicial powers, notwithstanding they may perform some quasi-
judicial duties, and the Legislature may not authorize officers or
bodies to exercise powers which are essentially judicial in their
nature.”). If the Department believed that Choice Plus failed to
substantiate that the ten claimants were Mrs. Rigley’s
beneficiaries, the Department should have intervened in the
probate court proceedings, which it did not do.
4
Rule 69I-44.021 was repealed by the Department in 2016
because the rule had been “superseded by the enactment of section
717.124(8) in 2013.”
11
Conclusion
Choice Plus presented a complete claim as required of it under
section 717.124 that included the order from the probate court
directing the Department to disburse the estate funds. While the
Department has a general duty to safeguard the estate funds in its
possession, it overstepped that authority here by administratively
invalidating the probate court’s order. We reverse the final order
on appeal and remand with instructions to grant Choice Plus’s
claim.
REVERSED and REMANDED.
LEWIS and RAY, JJ., concur.
_____________________________
Not final until disposition of any timely and
authorized motion under Fla. R. App. P. 9.330 or
9.331.
_____________________________
Seann M. Frazier, of Parker Hudson Ranier & Dobbs, Tallahassee,
for Appellant.
Lori Lynn Jobe and Josephine A. Schultz, Assistant General
Counsels, Tallahassee, for Appellees.
12