ALJDEC decisions subject to certification as final

05F-0253-ROC · Registrar of Contractors · 2004-12-10

STATE OF ARIZONA OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 22, 2004

APPEARANCES: Complainant appeared, with her husband Richard Gogan, on her own behalf; Respondent appeared on his own behalf, along with Qualifying Party Parris Griffith and witness Kristina Brockman.

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant Cheryl Gogan brings this action alleging breach of contract by Respondent Griffith Mobile Home Services by failing to provide a natural gas setup for Complainant’s manufactured home. It is also alleged that Respondent contracted while his license was suspended. At the hearing, the parties presented documentary evidence, including Complainant’s Exhibits A through G and Attachments 1 through 10 of Respondent’s Written Answer, filed September 15, 2004, and testimonial evidence from Cheryl Gogan, Parris Griffith, Gravity Griffith, and Kristina Brockman. Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Decision finding a violation of the statute prohibiting contracting while a license is suspended.

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FINDINGS OF FACT 1. Respondent is the holder of a class C-05 limited specialty residential contracting license (No. 122052) issued by the Registrar of Contractors (“ROC”).[1] That license is restricted by the ROC, and authorizes Respondent to perform “utility trenching & electrical pedestals only.”[2] Gravity Lee Griffith is Respondent’s sole proprietor and Parris Griffith is Respondent’s Qualifying Party. Hereinafter, “Respondent” will refer to the business, including both Gravity and Parris Griffith, unless otherwise specified. 2. Respondent has a business relationship with Estrella Homes, Inc. (hereinafter “Estrella”), a company that is apparently licensed by the Arizona Department of Building and Fire Safety, Office of Manufactured Housing (License #6863).[3] When Estrella sells a home, it hires Respondent to perform the “setup” work, which includes obtaining a permit, digging out the foundation and building a stem wall, trenching for utility lines, and backfilling. 3. In May 2004, Complainant entered into a contract with Estrella for the purchase and setup of a manufactured home.[4] Complainant negotiated the contract with someone named Andy Anderson at Estrella. Complainant never dealt with anyone from Respondent’s business while negotiating the contract with Estrella. Respondent’s witnesses testified that Anderson obtained from Respondent a bid amount for the setup portion of the contract, [5] which he then apparently used in the contract as a line item charge labeled “land improvements.”[6] Complainant received purchase documents that identified Respondent as the “lot improvement contractor” and provided Respondent’s telephone number.[7] 4. Complainant testified at the hearing that she had made it clear to Anderson that she wanted natural gas as one of the utilities to the home. She understood that she had negotiated a natural gas hookup as part of her deal with Estrella. Indeed, a line item on Respondent’s bid sheet,[8] given to Anderson and then signed by Complainant in January 2004, stated “Gasline & Hookup” for $250.00. 5. Respondent’s witnesses testified that the $250.00 line was a mistake on Respondent’s part. Respondent does not perform natural gas hookups because such work in beyond the scope of its licenses and because the natural gas provider, Southwest Gas Corporation, is the only entity that will do it. Southwest Gas will generally not even allow Respondent to dig the trench. Thus, Respondent admitted that the $250.00 line item was a mistake and should not have been listed on the bid sheet. However, the evidence shows that Complainants did not pay Respondent the $250.00.[9] 6. On the bid sheet, there is also a line item labeled “PERMITS, SET UP, FLOOD” and next to it is handwritten “with impact fees.”[10] It is assessed at $5500.00. Complainant testified that she thought that this included the natural gas hookup fee. However, Respondent’s witnesses testified that it did not. Complainant’s testimony is somewhat inconsistent because Complainant also testified that she thought that the “Gasline & Hookup” line item included the natural gas setup. Essentially, Complainant believed that the two lines together, both “PERMITS, SET UP, FLOOD with impact fees” and “Gasline & Hookup” meant that she was paying for a natural gas setup. And she testified that Anderson confirmed this by statements that he made to her. In addition, Complainant points out that she purchased natural gas appliances from Estrella with the home.[11] This bolsters her argument that Anderson should have known that Complainant intended to have natural gas as a utility at the home. 7. In June 2004, Respondent performed the setup work for Complainant’s home. Respondent did not install or dig trench for a natural gas hookup. According to Respondent’s witnesses, they did not even know that Complainant wanted natural gas. Furthermore, Respondent is not licensed to install natural gas. 8. In July 2004, Complainant was contacted by Southwest Gas and told that it would cost $2970.00 to install natural gas at her home.[12] She was shocked, thinking that she had already paid for it, and soon filed her complaint in this matter. Since this matter does not involve workmanship issues, no on-site inspection was performed and no Corrective Work Order (CWO) was issued. Complainant seeks $2970.00 from Respondent for failure to install natural gas. 9. The evidence is uncontested that installing natural gas is outside the scope of Respondent’s licenses. At most, Respondent could dig trench for the natural gas pipe. It is also undisputed by the parties that only Southwest Gas performs the installation of natural gas utilities, no one else. 10. Furthermore, ROC records show that in May and June of 2004, Respondent’s C-05 license, under which the work on Complainant’s home was done, was under suspension for lack of surety bond. Respondent’s witnesses testified that their bond lapsed and they were not notified, but re- instated a bond as soon as they became aware of the problem, in September 2004. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[13] Further, the standard of proof at hearing is by preponderance of the evidence.[14] Therefore, Complainant bears the burden of showing, by a preponderance of the evidence, that Respondent has violated the statutes cited in the Citation and Complaint.[15] Complainant has not met that burden. 2. The Citation and Complaint alleges violations of Arizona Revised Statutes (A.R.S.) § 32-1154(A)(1), (7) and (18). Subsection (A)(1) prohibits abandonment or refusal to perform work contracted for unless there is a legal excuse. Subsection (A)(7) prohibits wrongful acts that substantially harm another. Subsection (A)(18) prohibits contracting or offering to contract while a license is under suspension. 3. Complainant has not shown by a preponderance that Respondent has abandoned a contract or wrongfully harmed her. The evidence in this matter is not clear as to what the contract actually called for. The contract documentation is not clear and is poor. What was specifically included in the contract between Complainant and Estrella is not clear. And the bid sheet (Exhibit B), signed by Complainant but not Respondent, is even less clear. 4. Complainant never negotiated with Respondent. Complainant is essentially alleging that Respondent agreed to perform work that is beyond the scope of his license. Based on the evidence presented, such a conclusion is not evident. It is possible that Anderson wrongfully led Complainant to believe that she was purchasing the installation of natural gas at her home, but that cannot be concluded based on the evidence presented in this hearing. Nor can it be concluded on this evidence that Complainant paid Estrella for the installation of natural gas. Complainant is encouraged to consider filing a complaint against Estrella with the Arizona Department of Building and Fire Safety. 6. The evidence of record does not sufficiently sustain a conclusion of violation by Respondent of the provisions of A.R.S. § 32-1154(A)(1) or (A)(7) as charged in the Citation and Complaint. 7. The evidence does show, however, that Respondent has violated A.R.S. § 32-1154(A)(18) by contracting while the license was suspended. Respondent’s license was suspended for lack of bond from April through September 2004. Respondent is responsible for keeping the required bond in place, no one else. Respondent provided no documentation to support the testimony that he was unaware and uninformed. He provided no details about the matter. He merely stated that he did not learn of his lapsed bond until September 2004 and then immediately took care of it. This is not enough evidence to preclude finding Respondent in violation of the statute. 8. This tribunal concludes that a short period of disciplinary probation is the appropriate discipline in this matter.

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RECOMMENDED ORDER Based on the foregoing, it is hereby recommended that Class C-05 license number 122052, issued to Gravity Lee Griffith dba Griffith Mobile Home Services, be placed on disciplinary probation for ninety (90) days beginning the effective date of the Registrar’s Order.

In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the order will be 35 days from the date of that certification.

Done this 10th day of December 2004.

Office of Administrative Hearings

______________________________ Eric A. Bryant Administrative Law Judge

Original mailed this ___ day of December 2004, to:

Israel G. Torres, Registrar Registrar of Contractors ATTN: Jennifer Brown 800 West Washington, 6th Floor Phoenix, AZ 85007

By ___________________________ ----------------------- [1] Respondent holds other residential contracting licenses as well: a class C-03 (awnings and canopies) and a class C-41 (sewage treatment systems). [2] See, Arizona Administrative Code (A.A.C.) R4-9-103 for a description of license classifications, and the ROC website (www.azroc.gov) entry for license 122052 for the above-quoted statement of the scope of the license. [3] See Exhibit A. [4] Exhibit A. [5] Exhibit B. [6] Exhibit A. [7] Attachment 9 to Respondent’s Written Answer, filed September 15, 2004. [8] Exhibit B. [9] Attachment 10 to Respondent’s Written Answer, filed September 15, 2004. [10] Exhibit B. [11] Exhibit A, second page. [12] Exhibit G. [13] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [14] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [15] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996).

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