ALJDEC decisions subject to certification as final

06F-2666-ROC · Registrar of Contractors · 2007-01-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 2, 2007 APPEARANCES: Complainant Carol Ohlund appeared on her own behalf. Gary Smith, Esq. represented Respondent A B C Air Conditioning, Inc. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The question presented by this matter is whether Respondent A B C Air Conditioning, Inc. (“ABC”) is subject to discipline for acts or omissions in violation of A.R.S. § 32-1154(A). Based upon the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order. Procedural Matter During the course of the hearing, ABC’s counsel made a motion for a directed verdict. ABC’s motion was denied as the Administrative Law Judge ruled that the case should proceed on its merits for a full determination of the issues presented. FINDINGS OF FACT 1. ABC is the holder of a Class C-39R license (No. 154157) issued by the Registrar of Contractors (“ROC”). Thomas Smedley is ABC’s qualifying party. 2. On Sunday, June 4, 2006, Complainant Carol Ohlund contacted ABC because her air conditioning unit was malfunctioning. Ms. Ohlund obtained ABC’s information via the Yellow Pages. Ms. Ohlund had attempted to contact other HVAC contractors, however, none were open for business on a Sunday. That day, Mr. Smedley inspected the unit and determined that the compressor was “shorted to ground”. See Invoice No. 03757, dated June 4, 2006, a copy of which is contained in the case file, the contents of which administrative notice was taken. Mr. Smedley advised Ms. Ohlund that the compressor would need to be replaced and quoted her a price of $2,015.00. See Invoice No. 05988, dated June 4, 2006, a copy of which is contained in the case file. Ms. Ohlund informed Mr. Smedley that she would get back to him regarding the compressor replacement and Mr. Smedley left Ms. Ohlund’s residence. 3. Later in the day, Ms. Ohlund contacted Mr. Smedley and advised that she wanted ABC to proceed with the replacement of the compressor. That same day, ABC replaced the compressor, reclaimed the old Freon, installed a suction dryer, and evacuated and re-charged the system, as it was contracted to perform. Id. Ms. Ohlund paid ABC in full. 4. On June 30, 2006, Ms. Ohlund filed a complaint against ABC with the ROC alleging the following: Owner overcharged for services preformed (sic) and did not turn in the compressor that was under warranty until 2009. He did not refund the price of [the] compressor or provide itemized statement as he promised.

5. At hearing, Ms. Ohlund acknowledged that ABC informed her of the cost for the work performed prior to her deciding to proceed with the work and prior to its performing the work, and that Ms. Ohlund agreed to the quoted price. The gravamen of Ms. Ohlund’s testimony at hearing was that ABC over-charged her for the compressor, that ABC did not refund her the cost of the compressor notwithstanding that it was under warranty, and that she was dissatisfied with the itemized statement provided by ABC. See Exhibit 5. Ms. Ohlund asserted that ABC’s charges were not within industry standards. Ms. Ohlund failed to present any probative or substantial evidence establishing any industry standard for the cost of the work performed by ABC. Regarding the warranty, Ms. Ohlund testified that at the time the unit was replaced, her husband informed ABC’s technician that the compressor was under warranty. Ms. Ohlund asserted that ABC should have known that it was under warranty from the 1999 date on the nomenclature plate on the unit. However, despite Mr. Ohlund’s appearance at the hearing with Ms. Ohlund, Ms. Ohlund did not call Mr. Ohlund as a witness to corroborate this testimony. 6. Mr. Smedley credibly testified at hearing that he was present at the jobsite when the compressor was replaced and that neither Mr. nor Ms. Ohlund informed ABC that the unit was under warranty, and that Ms. Ohlund did not inform ABC of such until approximately two weeks after the work was completed. Mr. Smedley credibly testified that because ABC was unaware that a warranty on the compressor existed, it disposed of the part. Mr. Smedley contended that the parties’ contract did not require ABC to refund the price of the compressor to the Ohlunds and there was no communication regarding this issue until after the fact. 7. Mr. Smedley testified that ABC was not the HVAC contractor that originally installed the system, that the unit the Ohlunds replaced was a Heil unit, that ABC is a Trane Comfort specialist and is not familiar with Heil warranties, that notwithstanding the 1999 date on the nomenclature plate, he was unaware whether the unit was under a five or ten year warranty, and that there is no way of knowing what type of warranty may have been in existence, if any, by simply looking at the equipment. Mr. Smedley testified that it is incumbent upon the customer to inform the contractor about the existence of a warranty. 8. Mr. Smedley further credibly testified that he discussed the cost of the work with both Mr. and Ms. Ohlund prior to leaving their residence and advised them that it would cost less to have the work performed on a weekday, rather than on a weekend. Mr. Smedley testified that Ms. Ohlund contacted him shortly thereafter to request that the work be performed that day because the Ohlunds had approximately 25 guinea pigs in the home that they are raising as show animals and were concerned for their well-being. Mr. Smedley testified that ABC quoted the Ohlunds a flat rate price and was not under an obligation to itemize its invoice, and further, that Ms. Ohlund did not request an itemization until after the fact, and that ABC did in fact provide an itemized invoice. 9. The Administrative Law Judge finds, based upon the credible evidence of record, the following: a. ABC advised the Ohlunds of the cost of the work in advance of its performing the work; b. The Ohlunds accepted the price and requested that the work be performed immediately, notwithstanding that they were given the opportunity to contact other HVAC contractors and were informed that the price of the work would be less if they waited until the next day; c. It was incumbent upon the Ohlunds to inform ABC of the existence of any warranty prior to ABC commencing its work at their home in order to give ABC the opportunity to take appropriate action with respect to the disposition of the old unit, and the Ohlunds failed to do so. As such, ABC was under no contractual obligation to refund the cost of the compressor; d. ABC was not under any obligation to provide an itemized statement to the Ohlunds, yet did so at Ms. Ohlund’s request. The fact that Ms. Ohlund is dissatisfied with the detail of the statement is not sufficient to establish any wrongdoing by ABC; and e. Ms. Ohlund failed to establish that ABC’s charges were excessive or not within industry standards. CONCLUSIONS OF LAW In this proceeding, Ms. Ohlund bears the burden to prove, by a preponderance of the evidence, that ABC is subject to discipline for a violation of A.R.S. § 32-1154(A)(7) as charged by the ROC in its September 8, 2006 Citation and Complaint. See Arizona Administrative Code R2-19-119. 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). The Administrative Law Judge concludes that Ms. Ohlund has failed to meet her burden of proof as to the ROC’s charge. Under A.R.S. § 32-1154(A)(7), a contractor is subject to discipline for “the doing of a wrongful or fraudulent act . . . as a contractor resulting in another person being substantially injured.” The Administrative Law Judge concludes, based upon the credible evidence of record, that ABC did not commit any wrongful or fraudulent acts that substantially injured Ms. Ohlund. Therefore, the Administrative Law Judge concludes that Ms. Ohlund did not establish that ABC violated A.R.S. § 32- 1154(A)(7). The Administrative Law Judge concludes, based upon the weight of the credible evidence of record, that no grounds exist to impose discipline against ABC’s license. The ROC’s Citation in Case Number 06-2666, and the Complaint upon which it is based, should be dismissed. RECOMMENDED ORDER Based on the foregoing, the Administrative Law Judge makes the following Recommended Order: It is recommended that no discipline be imposed against ABC’s license, and that the Citation issued in Case Number 06-2666, together with the Complaint upon which it is based, be dismissed. 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 40 days from the date of that certification. Done this day, January 10, 2007.

______________________________________ Sondra J. Vanella Administrative Law Judge

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

Fidelis V. Garcia, Acting Director Registrar of Contractors Legal Department 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