ALJDEC decisions subject to certification as final

06F-2417-ROC · Registrar of Contractors · 2007-01-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 9, 2007 APPEARANCES: The Complainant represented himself. Doug Lano, Employee, represented the Respondent. ADMINISTRATIVE LAW JUDGE: Allen Reed _____________________________________________________________________ Findings of Fact Based on the evidence of record, the following findings are submitted.

1. In April 2006, the Complainant contacted the Respondent because of a leak in the bathroom of a rental property in Scottsdale, Arizona.[1] 2. The Respondent sent a serviceman (Darrel), to determine the cause of the problem. 3. The leak was under the slab near the toilet and required a “locater” to establish its precise location. 4. According to the Complainant, Darrel charged $383.00 for the service call and locator.[2] 5. The Complainant testified that Darrel told him it would take a day to fix the leak[3] and the cost would be $1551.00. The Complainant agreed to have the Respondent repair the problem. 6. In summary, the repair involved removal of the toilet, cutting through the slab, repairing the pipe, refilling the slab and replacing the toilet. The Complainant was present while the work was done. It took approximately three hours and the Complainant paid $1,551.23. This brought the total paid to the Respondent for the work, to $1,934.23. 7. The Complainant was disturbed by the fact that he had been told it would be a day long job and then having to pay $1,551.00 for three hours of work. He contacted the Respondent and spoke to Doug Lano (Lano), who agreed the Complainant he had been overcharged. Lano gave a preliminary amount of $700.00. 8. The Respondent subsequently refunded $519.00. The refund was determined based on the Respondent’s established cost of $1,158.84 for repair of the slab leak (including the locater), $71.50 for Darrell’s service call, $47.50 for replacement of a water heater valve, $65.70 for toilet removal, and $69.44 tax for a total of $1412.98[4].

9. The Complainant spoke to one of the Respondent’s former employees, John Doumakes (Doumakes), who told the Complainant the work which was done should have been around $800.00. The Complainant testified that he called another plumbing contractor and was told the job would have cost approximately $900.00. 10. The Complainant filed his Complaint with the Registrar of Contractors (ROC) on May 25, 2006.

Conclusions of Law The Citation and Complaint alleges the violation of A.R.S. §32- 1154(A)(7), a wrongful or fraudulent act resulting in substantial injury. 1. The Complainant has the burden of proof by a preponderance of the evidence under Culpepper v. State, 187 Ariz. 431 (1996 App.)[5] and A.A.C. R2-19-119. 2. A “preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence, §5 (1960). It is “evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary, 1182 (6th ed. 1990). 3. The evidence in an administrative hearing must be “substantial, reliable, and probative” (A.R.S. §41-1092.07(F)(1)). This means the Complainant has the affirmative responsibility to present sufficient competent evidence to meet the preponderance standard. The less demanding evidentiary standard in the administrative hearing does not mean that any type of evidence is entitled to serious consideration or significant weight. Although hearsay is admissible in administrative proceedings, the hearsay must be of a nature which would strongly indicate if not establish the information is accurate and reliable. 4. “Substantial evidence is evidence possessing something of substance and relevant consequence and which furnishes substantial basis of fact from which issues tendered can be reasonably resolved.” Black’s Law Dictionary, Special Deluxe Fifth Edition, (St. Paul Minn.: West Publishing Co., 1979) p. 1281, citing State v. Green, 218 Kan. 438, 544 P. 2d 356, 362. 5. The Complainant asserts the duration of the job was misrepresented by Darrel and that the Complainant would not have agreed to the quoted price had he known it would take only three hours. If the Complainant had known the truth, he would have contacted other contractors for repair estimates[6]. The Complainant also argues that even though the Respondent refunded $519.00, the Complainant is entitled to another $500.00 because the price charged by the Respondent is that much higher than the amounts quoted by Doumakes and another contractor. 6. Based on the Complainant’s unrebutted testimony[7] it is concluded that Darrel induced the Complainant to accept the cost for repair of the leak in part by the representation that it would be an all day job. This is a wrongful and possibly a fraudulent[8] act. However, the statute also requires substantial injury. The language is not defined but it is understood to include financial injury. Had the Respondent not refunded $519.00 to the Complainant, the injury and therefore the violation would likely have been established[9]. However, given the refund by the Respondent, the substantial injury is not established. The Complainant’s evidence regarding the lower cost asserted by Doumakes or another contractor for the repair work, is without any indicator of reliability. The Administrative Law Judge (ALJ), has no method of determining the basis for the asserted price quotes of $800.00 or $900.00 to do the work. In addition, it is must be noted that in a free market, contractors, like most other businesses and service providers will charge different amounts for the same service. There is no established regulated cost for the repair work done in this case. The amount charged by the Respondent was not shown to be excessive or unreasonable so as to constitute a substantial injury.

Recommended Order It is recommended the Citation and Complaint upon which it is based be Dismissed.[10]

Done this day, January 10, 2007

______________________________________ Allen Reed Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2007, to:

Fidelis V. Garcia, Acting Director Registrar of Contractors Legal Department 800 West Washington, 6th Floor Phoenix, AZ 85007

By ___________________________

----------------------- [1] The Complainant’s renter had informed him of the problem. [2] Based on the Complainant’s figures, $298.00 for the locator and $85.00 for the service call. [3] Darrel was not at the hearing but the Respondent’s witness testified Darrel has denied saying this. [4] The Respondent had testified the total was $1,413.04. It is acknowledged the various amounts testified to by the parties are not consistent and that there is a difference in the amount initially paid by the Complainant ($1,934.23) and the figure of $1,931.98 which represents the discount of $519.00 and the $1,412.98 actually charged. The difference is insignificant and is immaterial to the conclusion to be reached. [5] The Culpepper case applies to an administrative agency. However, since any violation established in this case may result in a sanction by the agency, the ruling in the case applies equally to the Complainant. [6] The Complainant had the opportunity to address the issue before he paid the Respondent. He was present during the repair and aware that it took only three hours. He paid nonetheless. It is not uncommon to grudgingly pay for a product or service believing you are being taken advantage of, and only after some time of thought and reflection (buyer’s remorse?), address what is perceived to be an injustice. [7] Darrel’s purported denial cannot be given any weight. [8] The general elements of fraud are an intentional and knowing misrepresentation, reasonable reliance, and detriment (damages) . [9] Based on the figures adduced at the hearing. [10] The effective date of the Order in this case is forty (40) days from the date of the Order or forty (40) from the date of certification by the Director of the Office of Administrative Hearings.

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