ALJDEC

01F-2250-ROC · Registrar of Contractors · 2002-05-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 10, 2002. APPEARANCES: The Complainant appeared personally. Respondent did not appear. 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. The commencement of the scheduled hearing was delayed for one-half hour to allow for the late arrival of an authorized representative for the Respondent. The official records of the Office of Administrative Hearings reflect that prior to the time for convening the hearing a telephone call was received from Chris O’Conner, Respondent’s general Manager. Mr. O’Conner informed OAH staff that Respondent’s representative, Ken Mathis, had a flat tire in Carefree, Arizona. The OAH staff member advised Mr. O’Conner that the hearing would be briefly delayed to allow for the late arrival of Mr. Mathis, or any other authorized representative for the Respondent. No appearance was made on behalf of Respondent. It is noted that Mr. Mathis never did appear at the OAH on the hearing date nor did he request to appear telephonically. Respondent’s subsequent request for rehearing is deemed premature. 2. Complainant entered into an agreement with the Respondent to finish tile work at Complainant’s home. 3. Pursuant to the terms of the parties’ agreement, Complainant was to pay Respondent the contract price agreed upon as follows: 1/3 down payment; 1/3 at 50% completion of work; and 1/3 upon completion. Complainant paid Respondent the total contract price in full. 4. Respondent installed tile over a shower pan in Complainant’s shower in his master bathroom. Respondent installed mud base over an existing neoprene-covered shower pan. The shower pan had not been properly installed. However, the assigned Registrar inspector credibly testified that the improperly installed shower pan should have been evident to Respondent. 5. After Respondent completed its work in the shower, the shower leaked causing damage to the interior of Complainant’s residence. 6. Respondent was requested to properly repair the shower but did not do so. 7. Respondent is found to have accepted the surface of the existing shower pan when it installed its tile upon it. 8. Respondent’s tile installation failed to meet its intended use. 9. Complainant subsequently brought a civil action against Respondent for damages sustained by him as a result of Respondent’s deficient workmanship. 10. Complainant also filed a complaint with the Registrar of Contractors alleging that Respondent violated provisions of the State’s contracting laws on Complainant’s project. 11. As noted in Respondent’s motion to dismiss filed in this matter, the Central Phoenix Justice Court entered a judgment against the Respondent and in favor of Complainant in the amount of $551.00, including costs. 12. Complainant made an election of remedies when he decided to file his civil action against Respondent. That civil court judgment is found to have resolved the issue of damages between the parties. 13. Notwithstanding the Central Phoenix Justice Court’s judgment establishing Respondent’s liability for damages pertaining to the shower, the Registrar of Contractors is determined to still have jurisdiction to contemplate the imposition of disciplinary sanctions against the Respondent for its violations of the State’s contracting laws. 14. Respondent previously filed a motion to dismiss the Citation and Complaint in this matter asserting that it had tendered payment to Complainant in full satisfaction of the civil court judgment. That motion was denied by this tribunal. During the hearing in this matter, Complainant testified credibly that he indeed had received a check in the amount of the judgment from Respondent. However, Respondent’s check dated April 22, 2002, could not be cashed by the Complainant due to insufficient funds in Respondent’s checking account. As late as 1:15 p.m. on the hearing date, Complainant confirmed that Respondent’s checking account still lacked funds to honor the check. 15. In response to Complainant’s complaint filed with the Registrar of Contractors, the assigned agency inspector issued a Corrective Work Order directing Respondent to timely repair the leaking shower and the interior damage caused by the leaking shower. 16. Respondent failed to comply with the Registrar’s written directive to perform the required repairs necessary to correct its deficient workmanship. 17. Respondent’s deficient workmanship and failure to comply with the Registrar’s written directive are deemed to be wrongful acts which have substantially injured the Complainant.

CONCLUSIONS OF LAW

1. The Registrar of Contractors has jurisdiction over the Respondent and the subject matter of this case. 2. Pursuant to the doctrine of res judicata, the final judgment of the Central Phoenix Justice Court on the merits as to Respondent’s liability for the shower pan and resulting damage cause by leaks from the shower is conclusive as to the rights and liabilities of the parties on the issue of the shower pan. However, that doctrine does not bar the Registrar of Contractors from imposing disciplinary sanctions against Respondent for proven violations of the State’s contracting laws committed by Respondent. 3. The evidence of record is adequate to establish that Respondent violated the provisions of A.R.S. § 32-1154(A)(7), (23) and (3); namely A.A.C. R4- 9-108. 4. Pursuant to the provisions of A.R.S. § 32-1154(D), the Registrar is authorized to impose a civil penalty not in excess of $500.00 on a contractor for each violation of A.R.S. § 32-1154(A)(23). The evidence of record supports the imposition of a civil penalty against Respondent.

RECOMMENDED ORDER

In view of the foregoing, it is recommended that Respondent’s Class C- license be revoked on the effective date of the entered Order in this matter. It is further recommended that if Respondent satisfies the Central Phoenix Justice Court judgment by paying Complainant the total sum of $551.00 with either a certified bank check or money order on or before the effective date of the entered Order in this case, then the above-provided license revocation shall not take place, but instead that Respondent’s Class C-05 license shall be placed on suspension for a period of 7 calendar days followed immediately by a period of disciplinary probation for 120 days. This alternative penalty shall commence, if at all, on the effective date of the entered Order in this matter. It is further recommended, if the alternative penalty is applicable and in addition to the above-provided penalties, that Respondent pay the sum of $300.00 to the Registrar of Contractors by way of a civil penalty pursuant to A.R.S. § 32-1154(D). The failure by Respondent to pay the entire amount of that civil penalty on or before 30 days following the effective date of the entered Order in this matter shall result in the automatic revocation of Respondent’s Class C-05 contracting license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(3), unless payment of any outstanding prior civil penalty is tendered. It is further recommended, if the alternative penalty is applicable and in addition to the above-provided penalties, that any restoration of Respondent’s rights to resume contracting, whether or not probationary, shall be subject to a condition that Respondent first post an additional surety bond, case deposit or alternative deposit for a period of 24 months, including future renewal periods, in the amount of $1,000.00, such bond or deposit to be in addition to the required surety bond, cash deposit or recovery fund participation set forth in A.R.S. § 32-1152(C). Cash or alternative additional deposits, if utilized, shall be returned only after the expiration of an additional two year period following the above- provided 24 month period and only if no claims are then pending.

Done this day, May 29, 2002

______________________________________ Brian Brendan Tully Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2002, to:

Michael P. Goldwater, Director Registrar of Contractors 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