ALJDEC

01F-O012075-BFS · Department of Building and Fire Safety · 2002-04-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 13, 2002. APPEARANCES: Assistant Attorney General M. Elizabeth Burns represented Complainant Department of Building and Fire Safety. Respondent Anthony & Associates failed to appear. ADMINISTRATIVE LAW JUDGE: Constantino Flores _____________________________________________________________________ The question presented in this case is whether grounds exist to take disciplinary action against Anthony & Associates for violation of various provisions of A.R.S. § 41-2180 and § 41-2186, in regards to failing to utilize deposits from purchasers for the purpose for which they were provided and/or failing to deposit all earnest monies into Respondent’s trust account no later than the close of the second banking business day after receipt. Based upon the evidence presented at the hearing, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: FINDINGS OF FACT Anthony & Associates holds a Class D-8 License (No. 7172) issued by the Arizona Department of Building and Fire Safety (the “Department”). Kurt W. Lohmeyer is Anthony & Associates qualifying party. On August 29, 2001, the Department filed a Citation and Complaint against Respondent Anthony & Associates, alleging three separate Counts. The Citation and Complaint was mailed, via certified mail, to Anthony & Associates’ qualifying party Kurt Lohmeyer, at 2551 W. Broadway, Phoenix, Arizona, 85041. Count I of the Citation and Complaint alleges that Respondent failed to utilize deposits, which were received from a number of listed purchasers, for the purpose for which they were provided. The named purchasers are Rodrigo Leyva, Ricardo Castro Jr., Lorena Aguilar, Eduardo Sandoval, Cirilo Aguilar, Jose Guerrero, Silvia Hernandez Juarez, Bonifacio Hernandez, Cesar Sepulveda and Victor Garcia. Count II alleges that in regards to various purchasers, Respondent failed to deposit all earnest monies into Respondent’s trust account no. 2924-8333, maintained at Bank One, no later than the close of the second banking business day after receipt. The pertinent named purchasers in this Count are Rodrigo Leyva, Cirilo Aguilar, Silvia Hernandez Juarez, Cesar Sepulveda and Victor Garcia. On or about September 10, 2001, the Department received an answer to the Citation and Compliant, from Respondent, essentially denying the allegations contained in the Citation and Complaint. The letterhead contained the same address for Respondent as the one stated in Paragraph 2 of the Findings of Fact. On January 16, 2002, the Department mailed a copy of the notice of hearing to Respondent, to the address mentioned in Paragraph 2 of the Findings of Fact. The notice informed Respondent of the hearing date, time, and location. At hearing, Complainant moved to dismiss Count III of the Citation and Complaint. Donna Grant, a Compliance Auditor II and Investigator with the Department, testified on behalf of Complainant. Respondent failed to appear. The evidence of record indicates that there are thirteen invoices that have not been paid by Anthony & Associates, eight (8) from Gleeson Mobile Home Service, totaling approximately $12,186.90 and five (5) from Valley Wide Awnings, Inc., totaling $10,302.50. These invoices pertain to purchasers Ricardo Castro, Lorena Aguilar, Eduardo Sandoval, Cirilo Aguilar, Jose Guerrero, Silvia Hernandez Juarez, Bonifacio Hernandez, Cesar Sepulveda and Victor Garcia. In regards to Mr. Leyva’s purchase, there appear to be three additional invoices that apparently have not been paid by Anthony & Associates. They are as follow: 1) A February 5, 2001 invoice from Valley Wide Enterprises, Inc., dba Gleeson Mobile Home Service (“Glesson”), for $2,197.00; 2) A February 22, 2001 invoice from Valley Wide Awnings, Inc., for $2,908.00; and 3) An April 11, 2001 invoice from Valley Wide Awnings, Inc. for $391.00. In regards to Ms. Aguilar’s purchase, there appear to be three additional invoices that apparently have not been paid by Anthony & Associates. They are as follow: 1) A May 22, 2001 invoice from Gleeson, for $2,000.00; 2) A May 31, 2001 invoice from Valley Wide Awnings, Inc., for $3,165.50; and 3) A June 6, 2001 invoice from Foster Mechanical, for $1,495.00. As to Mr. Aguilar’s purchase, there appears to be one additional invoice that apparently has not been paid by Anthony & Associates. This invoice is dated July 11, 2001, from Real A/C Heating and Cooling (“Real A/C”), for $647.00. As to Mr. Guerrero’s purchase, there appears to be an additional invoice that has apparently not been paid by Anthony & Associates. This July 12, 2001 invoice is from Real A/C, for $674.19. In regards to Ms. Hernandez Juarez’ purchase, there appear to be two additional invoices that have apparently not been paid by Anthony & Associates. They are as follow: 1) A July 7, 2001 invoice from Real A/C, for 674.89; and 2) A July 23, 2001 invoice from Ace Awning, for $1,502.50.

As to Mr. Hernandez’ purchase, there appear to be two additional invoices that have apparently not been paid by Anthony & Associates. They are as follow: 1) A June 5, 2001 invoice from Foster Mechanical, for $1,461.00; and 2) A June 29, 2001 invoice from Ace Awning, for $1956.00. Anthony & Associates received earnest money from purchaser Rodrigo Leyva, on December 28, 2000, in the amount of $2,750.00, which was deposited in Respondent’s trust account no. 2924-8333, maintained at Bank One, on January 4, 2001. Anthony & Associates received earnest money from purchaser Cirilo Aguilar, on May 25, 2001, in the amount of $2,500.00, which was deposited in Respondent’s trust account no. 2924-8333, maintained at Bank One, on May 31, 2001. Anthony & Associates received earnest money from purchaser Silvia Hernandez Juarez, on June 18, 2001, in the amount of $2,000.00, which was deposited in Respondent’s trust account no. 2924-8333, maintained at Bank One, on June 21, 2001. Anthony & Associates received earnest money from purchaser Cesar Sepulveda, on April 26, 2001, in the amount of $2,500.00, which was deposited in Respondent’s trust account no. 2924-8333, maintained at Bank One, on May 1, 2001. Anthony & Associates received earnest money from purchaser Victor Garcia, on June 7, 2001, in the amount of $2,500.00, which was deposited in Respondent’s trust account no. 2924-8333, maintained at Bank One, on June 12, 2001. The record also shows that in regards to purchases for Mr. Leyva, Mr. Castro, Ms. Aguilar, Mr. Sandoval, Mr. Aguilar, Mr. Guerrero, Ms. Hernandez Juarez, Mr. Hernandez, Mr. Sepulveda, and Mr. Garcia, Respondent Anthony & Associates received payment for the purchase transaction, which includes earnest monies. CONCLUSIONS OF LAW The burden of proof at an administrative hearing is generally upon the Complainant. Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). Further, the standard of proof at hearing is by preponderance of the evidence. A preponderance of the evidence is “such proof as convinces the trier of fact that a contention is more probably true than not.” Morris K. Udall, Arizona Rules of Evidence § 5 (1960). A.R.S. § 41-2180 (L) prohibits monies deposited into a trust account or an escrow account to be “utilized for any purpose other than the transaction for which they were provided.” A.R.S. § 41-2180 (E) provides that all “earnest monies shall be deposited in the escrow account or trust fund account no later than the close of the second banking business day after receipt.” A.R.S. § 41-2186 empowers the Director of the Department of Building and Fire Safety (the “Director”) to suspend, revoke, place on probation or impose an administrative penalty on any license held by a dealer who violates the provisions in this statute or article 2, which encompasses A.R.S. § 41-2151 et seq, and includes A.R.S. § 41-2180. Specifically, A.R.S. § 2186 (1) prohibits “[f]ailure in any material respect to comply with the provisions of this article or article 2 of this chapter.” A.R.S. § 2186 (6) prohibits “[t]he doing of a wrongful or fraudulent act by a licensee which relates to this article or article 2 of this chapter.” As to Count I of the Citation and Complaint, the Administrative Law Judge finds that the Department sustained its burden to prove that Anthony & Associates violated A.R.S. § 41-2180 (L) and § 41-2186 (1) and (6), as to all purchasers and mentioned invoices in the Findings of Facts. As to Count II of the Citation and Compliant, the Administrative Law Judge finds that the Department sustained its burden to prove that Anthony & Associates violated A.R.S. § 41-2180 (E) and 41-2186 (1) and (6), as to the pertinent purchasers addressed in the Findings of Facts. Based upon the foregoing violations, it is appropriate for the Department to impose discipline against Anthony & Associates.

RECOMMENDED ORDER In view of the foregoing and upon the recommendation of the Department, with there being no mitigating or exculpatory evidence of record, it is recommended that commencing on the effective date of the Order entered in this matter, Respondent Anthony & Associates’ Class D-8 License (No. 7172) be revoked. Done this day, April 2, 2002

______________________________________ Constantino Flores Administrative Law Judge

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

Department of Building and Fire Safety N. Eric Borg ATTN: Shawna Blank East Virginia, Suite 100 Phoenix, AZ 85004

By ___________________________

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