ALJDEC

01F-2036-ROC · Registrar of Contractors · 2001-08-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 30, 2001. APPEARANCES: George H. Smith, Complainant’s attorney; Alfred W. Smith, Jr., Complainant’s representative; Richard Stewart, Respondent’s qualifying party; Sara Steward, Respondent’s secretary-treasurer; Dan Pryor, Complainant’s witness; Robert Bradley, Respondent’s witness; Rhonda Sheerin, Respondent’s witness; and Wade and Else McCasslain, observers. ADMINISTRATIVE LAW JUDGE: Dorinda M. Lang. _____________________________________________________________________ A C T Rebar Contractors, Inc. filed a complaint with the Registrar of Contractors against Aloha Pools for hiring an unlicensed subcontractor. The subcontractor in question was actually an employee of A C T Rebar. He was hired by an employee of Aloha Pools without the authority or knowledge of Aloha Pools or anyone there. The subcontractor was not licensed by the Registrar of Contractors. He stole re-bar from his employer, A C T Rebar, to do the job. Under the facts of the case, A C T Rebar did not establish that Aloha Pools violated the provisions of the Arizona Revised Statutes governing licensed contractors under the Registrar of Contractors. Therefore, it is recommended that this complaint be dismissed.

FINDINGS OF FACT 1. Complainant filed a complaint against the Respondent for hiring an unlicensed subcontractor. The subcontractor, Tracy Yazzie, was actually an employee of the Complainant. He was hired by the Respondent’s part time employee, Mark Lawrence, for one job. Mr. Lawrence had been instructed to install the re-bar in a swimming pool for a customer of the Respondent. Rather than going to the home and doing the job he was instructed to do, he hired Tracy Yazzie, who was not licensed, to do the job for him instead. Mr. Yazzie did the job using re-bar that he stole from the Complainant. Mr. Yazzie was employed by the Complainant at the time but agreed to do the job for Mr. Lawrence as a side job, making additional money by charging for re-bar that he actually stole. 2. Mr. Lawrence, even though he is the grown step-son of the qualifying party, was not authorized to hire people for the Respondent. He was an occasional part-time employee who was specifically instructed to go to the job site and install the re-bar. For some reason, he decided to do something else that day and pay someone else to do the job for him instead. When he did, the subcontractor he hired stole the re-bar from his own employer, the Complainant, to put on the job. Police Officer Dan Pryor testified at hearing that Mr. Yazzie admitted stealing the re-bar from the Complainant. 3. Neither the qualifying party nor the secretary-treasurer were aware that Mr. Lawrence hired Mr. Yazzie until after it was done. They found out about the theft only after the Complainant accused them of it. Mr. and Mrs. Stewart have a long history of working in the spa and pool business and have never been accused of stealing materials. Mr. Stewart testified that he’s had complaints but has resolved them and his record is good. Ms. Stewart, the secretary-treasurer is the president-elect of the Arizona Chapter of the National Spa and Pool Institute and works with the Registrar of Contractors in developing standards for spa and pool builders. Her reputation in the spa and pool industry is excellent. Mr. Stewart would not have allowed Mr. Yazzie to be hired as a subcontractor, especially had he known that Mr. Yazzie was a thief. The Stewarts stated that they can sympathize with the Respondent because they have had employee thefts before too, but they did not have anything to do with it. 4. The Complainant argued that it wants restitution for $265 in lost material as well as $500 for Mr. Smith’s time, $500 for the attorney’s time, and $135 for subpoena costs. The Respondent argued it has always been willing to pay for the materials but Complainant would not accept this and that it should be reimbursed for its time and costs as well. CONCLUSIONS OF LAW 1. This matter is within the jurisdiction of the Registrar of Contractors pursuant to A.R.S. §§ 32-1104(A)(4), 32-1154(B) and 32-1156. 2. The Citation and Complaint issued by the Registrar of Contractors in this matter alleged potential violations of A.R.S. § 32-1154(A)(7) and (10). 3. The Arizona Revised Statutes at § 32-1154(A)(7) provides for suspension or revocation of a contractor’s license for the “doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured”. 4. The Arizona Revised Statutes at § 32-1154(A)(10) provides grounds for suspension or revocation of a contractor’s license for “(a)iding or abetting an unlicensed person to evade the provisions of this chapter, knowingly combining or conspiring with an unlicensed person or acting as allowing one’s license to be used by an unlicensed person or acting as agent, partner, associate or otherwise of an unlicensed person with intent to evade provisions of this chapter”. 5. In this case, the Respondent has established that Mr. Yazzie was hired without its knowledge or permission by an employee who was not authorized to act in that manner. Under these facts, it is clear that the Respondent had no intent to evade the requirements of the statutes governing the Registrar of Contractors and did nothing to aid or abet Mr. Yazzie. Therefore, the evidence did not establish a violation of A.R.S. § 32-1154(A)(10). 6. An issue remains as to whether the Respondent did a wrongful or fraudulent act that resulted in another person being substantially injured, a violation of A.R.S. § 32-1154(A)(7). Again, the fact that the Respondent had no knowledge that Mr. Yazzie was hired and did not give any authority to Mr. Lawrence to hire him militates against a finding of wrongdoing by the Respondent. Further, it was the Complainant’s own employee who stole from him, so it was the Complainant who put the thief in position to victimize him, not the Respondent. From the testimony at hearing it appears that Mr. Yazzie stole the re-bar from the Complainant for side jobs for other contractors as well. The injury in this case arose from the Complainant’s own action in hiring a thief, not any action by the Respondent. 7. The Registrar of Contractors may consider the prior record of a contractor in any disciplinary proceeding provided the records are introduced into evidence. A.A.C. R4-9-117. On standing motion by the Registrar of Contractors and as noted in the Citation and Complaint issued in this case, the computer records of the Registrar of Contractors may properly be considered to be evidence in the event the Administrative Law Judge finds a violation of any of the statutory provisions cited in the Citation and Complaint. In this case, the evidence presented did not establish a violation of the above laws. Therefore, examination of the Respondent’s record on the Registrar of Contractors’ motion is not appropriate. The Stewarts did testify, however, as to the quality of their license, so confirmation of their testimony is appropriate. Registrar of Contractors records show that Aloha Pools has been licensed since 1979 and that it has had five valid, closed complaints that were resolved by the contractor in the last two years. RECOMMENDED DECISION Based on the foregoing considerations, I recommend that this complaint be dismissed and that the Registrar of Contractors decline to discipline the Respondent’s license.

Done this day, August 2, 2001. OFFICE OF ADMINISTRATIVE HEARINGS

______________________________________ Dorinda M. Lang Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2001, to:

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

By ___________________________

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