ALJDEC

01F-P0272-ROC · Registrar of Contractors · 2001-12-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: December 10, 2001. APPEARANCES: The Complainant, Thurman Curtis Ashcraft, appeared personally. Respondent, Big D Aldrete’s Construction, Inc., was represented by its president and qualifying party, David Carl Aldrete. 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. Respondent is the holder of License Number 116559, a Class B- general residential contracting license, issued by the Registrar of Contractors. 2. A review of the official records of the Registrar of Contractors and the testimony of its inspector, Tom Sandoval, reveal that Respondent’s said Class B- license is suspended as follows:

a) Suspended on December 10, 1999, until Respondent complies with the Registrar’s Order in Case No. F98-0206. b) Suspended on March 28, 2000, as a result of a payout from the Residential Contractors’ Recovery Fund. c) Suspended on June 11, 2000 for lack of bond. d) Suspended by operation of law due to Respondent’s failure to timely renew its license, which expired at the end of August, 2000.

3. As a result of those suspensions of its Class B- license, Respondent could not legally perform any contracting requiring a valid contractor’s license as of the dates of those individual suspensions. 4. On or about March 16, 2001, Complainant and Respondent entered into a written agreement for remodeling work. Respondent’s Class B- license was suspended on that date. Respondent was also not bonded. 5. When Complainant entered into the written agreement, he relied upon Respondent’s oral and written representations that it was a properly licensed and bonded contractor. 6. On or about March 16, 2001, Complainant paid Respondent the sum of $14,255.10, which was the total contract price. 7. On March 16, 2001, Respondent’s president and qualifying party, David Aldrete, told Complainant that work would begin the following Monday. The work was not commenced that Monday. 8. Even though Respondent’s license was suspended and it did not have a bond, Respondent proceeded to do work on Complainant’s house, albeit without due diligence. 9. As a result of Respondent’s lack of reasonable progress on the remodeling project, Complainant filed a complaint with the Registrar of Contractors alleging that Respondent had violated provisions of the State’s contracting laws on this project. 10. In response to Complainant’s complaint, the Registrar’s assigned inspector, Tom Sandoval, performed a jobsite inspection to view the areas of alleged deficiencies. 11. As a result of that jobsite inspection, Inspector Sandoval issued a Corrective Work Order requiring Respondent to timely undertake specific remedial actions. Because Respondent’s general contracting license was suspended, the written directive required Respondent to cause properly licensed contractors to perform the required remedial repairs. 12. The Corrective Work Order required Respondent to hire a properly licensed contractor to replace the awning-snow roof. 13. Respondent entered into a subcontract with Ron Butler, a licensed roofing contractor. Their agreement provided that Respondent would pay Mr. Butler one-half of the subcontract price prior to commencement and the balance upon completion of the roofing work. Respondent did pay Mr. Butler the down payment. 14. On or about July 16, 2001, Mr. Butler installed the roof. However, some minor work does remain to be done. 15. Mr. Butler and Respondent have a disagreement as to the former’s entitlement to receive the remaining balance of roofing subcontract. 16. The Corrective Work Order required Respondent to hire a properly licensed contractor to install knobs and lock set on the door to the shed- shop. While there is credible evidence that the remedial work was performed, it is unclear whether Respondent hired a properly licensed contractor to perform the work as required by the written directive or if Respondent performed the work itself. 17. The written directive required Respondent to hire a properly licensed electrician to complete the installation of electric boxes and lights. There is credible evidence that Respondent did not comply with that directive. 18. The back eaves of the shop-shed have been painted as required by the Inspector. 19. There was credible testimony from Inspector Sandoval that Respondent did do some remedial work on Complainant’s house despite its license being under suspension, its lack of bond and the written directive to Respondent requiring it to hire properly licensed contractors to perform the remedial repairs. 20. It is determined that Respondent failed to comply with the Registrar’s written directive. 21. Respondent’s contracting while its license was under suspension, its failure to perform contracting work to minimum workmanship standards notwithstanding not being legally permitted to perform the work and its failure to comply with the Registrar’s written directive are deemed to be wrongful acts which have substantially injured the Complainant. 22. The Respondent’s contention that Complainant’s son hindered its performance on this project is irrelevant. First, Respondent was not legally entitled to be performing either the scope of work or the ordered remedial work on the project because its contracting license was under various suspensions. Second, the dispute between Complainant’s son and Respondent’s personnel is a matter for the judicial courts to resolve, if necessary, rather than by the Registrar of Contractors and/or the Office of Administrative Hearings. 23. Respondent’s suspended license status must be considered when determining appropriate penalties in this case. Little, if any, motivation would exist for any Respondent contractor to undertake and cause to be completed necessary remedial work in order to avoid a suspension of an already suspended license.

CONCLUSION OF LAW

1. Pursuant to A.R.S. § 32-1154(C), the suspension of a license by operation of law or by decision and order of the Registrar does not deprive the Registrar of jurisdiction to proceed with any action or disciplinary proceeding against such license, or to render a decision suspending or revoking such a license. 2. The evidence of record is adequate to establish that Respondent has violated the provisions of A.R.S. § 32-1154(A)(7), (18) and (23). 3. Pursuant to the provisions of A.R.S. § 32-1154(D), the Registrar may impose a civil penalty of not to exceed $500.00 on a contractor for each violation of A.R.S. § 32-1154(A)(23). The Registrar should strongly consider the imposition of a civil penalty against the Respondent as a disciplinary penalty in this matter. Respondent contracted while under suspension and without a bond, it failed to substantially comply with the Registrar’s corrective work order, and it even violated the Registrar’s directive to have properly licensed contractors perform the required remedial work due to Respondent’s license being suspended by doing some of the work itself.

RECOMMENDED ORDER

In view of the foregoing, it is recommended that Respondent’s Class B- license be revoked on the effective date of the entered Order in this matter. It is further recommended that if Respondent causes, at its sole cost and expense, properly licensed contractors to accomplish the items of corrective work set forth in the Registrar’s Corrective Work Order, the terms of which are incorporated herein by reference, and also to inspect and, if necessary to meet minimum workmanship standards, repair the remedial work performed by Respondent in response to the Registrar’s written directive on or before the effective date of the entered Order in this matter, then the above-provided license revocation shall not take place, but instead that Respondent’s Class B- license shall be placed on suspension for a period of 30 days followed immediately by a period of disciplinary probation for 180 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 alternative disciplinary penalties, if any, that Respondent pay the sum of $500.00 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 the aforesaid 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 B 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)(5), 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 alternative disciplinary penalties, if any, that any continuation 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, cash deposit or alternative deposit for a period of 24 months, including future renewal periods, in the amount of $4,000.00, 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, December 19, 2001

______________________________________ Brian Brendan Tully Administrative Law Judge

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

Registrar of Contractors Michael P. Goldwater, Director 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