ALJDEC

00F-1191-ROC · Registrar of Contractors · 2000-02-22

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: February 21, 2000. APPEARANCES: Complainant appeared personally. Respondent was represented by its attorney, Don C. Wilkinson, Esq. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________

Evidence and testimony were presented and, based upon the entire record, the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT

1. Complainant purchased a residential property located at 830 West Solano, Phoenix, Arizona. 2. Complainant originally intended to remodel the residence for resale. 3. Complainant hired Cashmere Custom Inc. to be the general contractor to build the remodeled shell of Complainant’s residential property. 4. On or about February 6, 2000, Complainant and Respondent entered into a written agreement for electrical remodeling work. The written agreement set forth the scope of electrical work to be performed by Respondent. The work was to commence on February 6, 2000, and was estimated to be completed by February 21, 2000. 5. The total contract price for the electrical subcontract was the sum of $4,862.70. That total included the following breakdown:

a) $1,650.00 Total amount of materials b) $ 158.00 Plus sales tax on materials c) $3,054.61 Total amount of labor d) $4,862.90 The total amount of the contract

Complainant paid Respondent a down payment in the amount of $2,500.00 at the time the agreement was signed. The balance of the contract price was to be paid at 50% when one-half of the work was completed and the remainder due upon completion of the project. 6. Shortly after entering into the written agreement and paying the down payment, Complainant contacted Respondent and requested that no electrical work be performed until she made a decision on whether or not to expand the limited remodeling project to a total major remodeling project. 7. Complainant ultimately decided to expand the project to a total remodel of the house. She advised Respondent that it would be given an opportunity to rebid the electrical work on the expanded project. 8. Complainant’s decision to expand the project beyond the scope of the original agreement with Respondent terminated Respondent’s obligation to perform such work. 9. Respondent was not under any obligation to submit a second bid for the electrical work on the expanded project. Although Complainant informed Respondent that it could submit such a bid, Complainant would have had the option of accepting or rejecting such a new bid. 10. Complainant is entitled to receive from Respondent the materials purchased with her down payment, including an accounting of the costs and taxes paid for those materials. In the event that those costs and expenses are less than the total sum of $1,808.24, being the total amount of materials plus sales tax on materials provided for in the agreement, Respondent is responsible for returning the difference to Complainant. 11. The parties agree that Respondent is entitled to some compensation for work performed on this project. However, neither party established a valuation for such services. Unless the parties can mutually agree on the compensation to be paid to Respondent, that issue should be resolved by a civil court of competent jurisdiction. 12. Respondent is found to have committed a wrongful act by not presenting Complainant with the materials purchased for the original scope of work and any balance of money for materials paid by Complainant with her original down payment. Respondent’s wrongful act is found to have substantially injured Complainant.

CONCLUSIONS OF LAW

1. Complainant terminated the parties’ original agreement when she decided to change the project from a small remodel project to an extensive major remodel. Once the agreement was terminated, Respondent was not obligated to submit a second bid to Complainant for the electrical work in the expanded remodel project. 2. The evidence of record is adequate to establish that Respondent has violated the provisions of A.R.S. §32-1154(A)(7). 3. The evidence of record is insufficient to establish that Respondent has violated the provisions of A.R.S. §32-1154(A)(1). … … …

RECOMMENDED ORDER

In view of the foregoing, it is recommended commencing on the effective date of the Order entered in this matter that Respondent’s Class C-11 license be suspended until the Registrar of Contractors receives written proof that Respondent has delivered to Complainant the materials purchased with her down payment, together with an accounting of the actual costs and taxes paid for those materials, and the return of the difference, if any, between the costs and taxes paid for those materials and the sum of $1,808.24. It is further recommended that if Respondent delivers the materials and refunds to Complainant any outstanding balance of the down payment for materials, if any, as above-provided on or before the effective date of the Order entered in this matter, then the above-provided suspension shall not take place and the Citation and Complaint in this matter shall be closed. Done this day, March 13, 2000.

______________________________________ Brian Brendan Tully Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2000, to:

Registrar of Contractors Michael P. Goldwater, Director ATTN: Joyce Armijo 800 West Washington 6th Floor Phoenix, AZ 85007

By ___________________________ -----------------------

Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826