ALJDEC

01F-2299-ROC · Registrar of Contractors · 2001-09-24

STATE OF ARIZONA IN THE OFFICE OF ADMINISTRATIVE HEARINGS

The above matter came on for hearing on September 24, 2001. The Complainants were represented by their attorney, James L. Csontos, Esq. and the Respondent was represented by its attorney, Richard B. Murphy, Esq. Based upon the entire record, the following Findings of Fact, Conclusions of Law and Recommended Order are made.

FINDINGS OF FACT

1. Immediately after the formal opening of the scheduled hearing, and following prolonged discussions between the parties with the Administrative Law Judge remaining present, it was confirmed that a settlement agreement had been concluded. The essential terms of the finalized overall settlement, modifying in small part the provisions of a previously executed written settlement agreement, were thereupon read onto the record.

Pursuant to the provisions of the parties’ settlement agreement, Respondent agreed to pay or tender certain specified monetary amounts to several identified

subcontractors or suppliers no later than a stated time-essence deadline date. Respondent also agreed to provide to Complainants, on or before such deadline date, copies of all subcontracts and warranties, together with all applicable invoices for incurred charges relating to the jobsite project as well as payment records pertaining to such invoices. Respondent further agreed to cooperate with Complainants and with the selected successor general contractor in the obtaining of necessary corrective work performances from certain subcontractors, as outlined in a written directive issued by the Registrar’s assigned Inspector.

3. Complainants agreed to withdraw their presently pending administrative complaint before the Registrar and to consent to the entry of an Order dismissing the within Citation without prejudice.

4. Both parties re-affirmed their prior entry into and execution of a detailed Settlement Agreement and Mutual Release of Claims containing eight recital paragraphs and nineteen covenant paragraphs. Such agreement effectively provided for the dismissal of a concurrently pending civil lawsuit initiated by Complainants and for the release of two individually recorded mechanic’s liens filed by Respondent, as well as for the dismissal of the instant administrative action. Under all the circumstances, and to properly effectuate the intent of the parties in resolving all presently pending civil and administrative actions, it is found and determined that a dismissal by the Registrar of Case Number 01-2299 is fully warranted and appropriate.

The previously executed written settlement agreement had listed, in covenant paragraph number 3, a group of various unpaid subcontractors or suppliers to whom payments by Respondent were to be transmitted, and at the hearing, one more identified creditor was added to the listing with a fixed monetary amount specified for payment. The parties’ mutual agreement at the hearing, augmenting the list appearing

in the written settlement document, provided that Respondent was required to timely pay such sum to this additional creditor.

6. Notwithstanding the provisions of covenant paragraph number 6 of the written settlement, purporting to require a dismissal by the Registrar upon completion of all enumerated corrective work items, it was mutually agreed that this matter would be dismissed on the effective date of the Registrar’s Order, irrespective of the progress or status of the contemplated corrective work. However, it was further agreed that such dismissal would be expressly without prejudice to the filing of a timely petition for rehearing or of a new, separate complaint in the event of any asserted breach by Respondent of the payment terms or other terms of the parties’ settlement agreement.

7. The administrative disciplinary proceedings hereunder are effectively cut short by the parties’ entry into the above-described settlement agreement which is to be presented to the Registrar of Contractors for approval and adoption. Consequently, Respondent must be and hereby is advised that any future alleged and proven breach of the payment terms or other terms of the settlement agreement will not only constitute grounds for the filing of a timely petition for rehearing or of a new complaint but also shall warrant treatment as a circumstance in aggravation.

All rights and defenses of the respective parties are deemed to have been merged into the settlement agreement, and if any timely petition for rehearing of this matter is to be filed and granted, or if any new complaint is filed in the future, the sole issues for determination shall be whether Respondent has performed its obligations under the terms of the aforesaid settlement agreement

9. It was mutually understood that the entry by the respective parties into the settlement agreement was without any admission of fault, liability or obligation on the

part of Respondent, and correspondingly without any admission by Complainants that they were not entitled to greater benefits.

10. The terms of the foregoing settlement agreement appeared to be fair and reasonable under all the circumstances, and the agreement was determined to be the product of knowing and voluntary action on the part of each party.

CONCLUSIONS OF LAW

1. The policy of the law favors settlements of disputes, and adverse parties should be free to adjust their differences by entry into agreements or stipulations which should be recognized and given effect by all tribunals.

2. The ultimately concluded settlement reached, confirmed and submitted during the hearing of this matter, having been found to be reasonable and voluntarily made, warrants the termination of the instant hearing and the dismissal of the charges contained in the Citation and Complaint.

RECOMMENDED ORDER

In view of the foregoing, it is recommended that the entire Citation and Complaint in Case Number 01-2299 be dismissed without prejudice.

Dated: September 26, 2001. OFFICE OF ADMINISTRATIVE HEARINGS

______________________________________ Robert I. Worth Administrative Law Judge

Original transmitted on _____________________

by: _____________________________ , to:

Michael P. Goldwater, Director Registrar of Contractors 800 West Washington Street (6th Floor) Phoenix, AZ 85007

ATTN: Joyce Armijo -----------------------

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