ALJDEC

01F-2386-ROC · Registrar of Contractors · 2001-09-12

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 10, 2001 APPEARANCES: Co-Complainant, Dalton Family Trust appeared through one of its trustee’s, Ray Dalton and Respondent appeared through its president, Barry Flemming. ADMINISTRATIVE LAW JUDGE: Mark A. Silver _____________________________________________________________________

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

FINDINGS OF FACT

1. At the outset of the scheduled hearing, the caption in this matter was amended to allow the Dalton Family Trust to act as Co-Complainant, due to the fact that the owner and qualifying party of Charles Dalton Air Conditioning and Metal Works (“Charles”) was deceased.

2. The following salient facts were adduced at the hearing and are important to note:

a. Charles and Respondent have done business together for a significant period of time, with Charles providing air conditioning, heating, and sheet metal work on Respondent’s home remodel projects. b. Due to the long-standing relationship of the parties, they did not use written contracts and performed all contracts on a strictly verbal basis. c. In the past Respondent normally paid Charles within one week of his completion of the contracted work. d. Sometime around the summer of 2000, Respondent became in arrears for payment on several jobs performed by Charles, resulting in a significant sum of money due to Complainant and an unnecessary delay in Charles receiving payment for work performed. e. Evidence of record showed that Respondent gave Charles three checks without sufficient funds to cover them. However, the undisputed evidence presented at the instant hearing showed that Respondent eventually issued replacement checks for two of the checks and Charles had no problem cashing said replacement checks. f. During the course of the instant hearing, Complainants presented testimony indicating that at the time of the hearing the only remaining unpaid billing was for a job known as the “McCreary” job. The billing for this job was in the amount of $5,400.00. Complainants presented evidence that they had received Respondent’s check no. 24025, in the amount of $5,400.00, and that said check could not be cashed due to insufficient funds. g. Respondent testified that although check no. 24025, issued by Respondent on October 27, 2000, did not have sufficient funds to cover the payment, it eventually paid Charles the sum of $5,400.00 via a cashier’s check dated November 20, 2000. A photo copy of the November 20, 2000 cashier’s check was entered into evidence and the back of said check shows that same was cashed by Charles. h. Complainants dispute the fact that the aforementioned November 20, 2000 check was issued for the McCreary job and that although same “coincidentally” is in the same amount as called for on the McCreary job, they contend that said check was issued merely as a partial payment to pay down the outstanding balance due, which included more than just the McCreary job. Thus, Complainants continue to claim non- payment for the work performed on the McCreary project. i. It should be noted that none of the other jobs that comprised portions of the amount claimed past due and owing by Complainants were for the sum of $5,400.00. In addition, it should also be noted that sometime around the time that the aforementioned $5,400.00 cashier’s check was issued, the owner and qualifying party of Charles passed away.

3. Based on the foregoing testimony and evidence, it is determined and held that the evidence presented militates for the conclusion that Charles was paid the $5,400.00 for the McCreary job, albeit belatedly. Although there may be other sums still due to Charles, Complainants did not make any other claims for payment at the instant hearing.

4. Notwithstanding the fact that Respondent is found to have ultimately paid on all three non-sufficient funds checks, it is determined and held that its failure to make timely payments for work performed by its subcontractor and the issuance of three separate checks without sufficient funds to “cover” same, causing undue and unnecessary delays in Charles receiving payment for work performed, constitutes a wrongful act within the meaning of the applicable charged section of the State’s Contracting laws. Therefore, the imposition of appropriate disciplinary sanctions against Respondent’s license is deemed to be warranted.

5. Notice is hereby taken of official Registrar of Contractors’ public records, which reveal that Respondent’s contracting license has been canceled since July 13, 2001. Such canceled license status does not preclude this tribunal from conducting these administrative proceedings nor does it prevent the Registrar of Contractors from issuing disciplinary orders.

6. As set forth in the Citation and Complaint issued by the Registrar of Contractors, Respondent was advised that in the event of a finding of a violation against Respondent, Respondent’s prior disciplinary record of final Registrar of Contractors’ orders may be considered in mitigation or aggravation. Accordingly, subsequent to conclusion of the instant hearing, notice was taken of official records of the Registrar of Contractors regarding any prior final disciplinary orders against Respondent and said notice revealed the absence of any prior disciplinary order against Respondent’s license. Therefore, Respondent’s prior record is properly deemed to be good and thus, is viewed as a matter in mitigation for any disciplinary penalties to be imposed as a direct result of this case.

CONCLUSIONS OF LAW

Respondent violated the provisions of A.R.S. § 32-1154A (7).

RECOMMENDED ORDER

In view of the foregoing, it is recommended that Respondent’s Class B license be placed on a period of 90 days disciplinary probation. This additional disciplinary penalty shall commence on the effective date of the Order entered in this matter or the date on which notice of Respondent’s compliance with the terms of this Order is filed with the Registrar, whichever is later. It is further recommended, in addition to the above provided penalty, that any continuation or restoration of Respondent’s contracting rights, whether or not probationary, shall be subject to a condition that Respondent first post an additional surety bond, cash deposit or alternative deposit for a period of twenty-four (24) months, including future renewal periods, in the amount of $2,500.00, 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 (D). Cash or alternative additional deposits, if utilized, shall be returned only after the expiration of an additional two year period following the above-provided twenty-four (24) month period and only if no claims are then pending. Done this day, September 12, 2001

______________________________________ Mark A. Silver 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