ALJDEC decisions subject to certification as final

07F-0820-ROC · Registrar of Contractors · 2007-05-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 3, 2007 APPEARANCES: Complainant appeared through its president, David Albrecht (“David”) and Respondent appeared through its president, Sherry O’Neill ADMINISTRATIVE LAW JUDGE: Mark A. Silver _____________________________________________________________________

Evidence and testimony were presented and, based upon the entire record in this matter, the following Findings of Fact, Conclusions of Law, and Recommended Order are made:

FINDINGS OF FACT

1. Complainant contacted Respondent in regard to a specified air conditioning repair job. In the course of Complainant’s dealings with Respondent, Complainant contends that Respondent’s conduct violated the State’s Contracting laws. The issues surrounding this claim are discussed in the findings below.

2. The following salient facts were adduced at the hearing and are important to note:

a. Complainant is the owner of a commercial property. According to David, there are fourteen (14) air conditioning units on the roof of Complainant’s building. The units were installed as new units on or about March 2004. Respondent was not the original installer of the air conditioners. b. The units in question are manufactured by Trane and carry a one (1) year labor warranty, with a five (5) year warranty on the compressor. c. According to David, on or about May 2006 he found one of the units blowing warm air into the building. He immediately contacted the original contractor regarding the problem. The original contractor came to Complainant’s building and determined that the compressor was “shot” and therefore, he would provide Complainant with a labor only charge to replace the compressor. This contractor provided Complainant with a bid to perform the remedial work for the sum of $1,142.00. It should be noted that this bid did not mention a replacement of the reversing valve for the unit. d. After receiving the original contractor’s bid to replace the compressor, David decided that the bill was too high, plus he had issues with the original contractor and thus, decided to seek remedial work from another contractor. He then contacted the Trane supplier and asked who they would recommend. Someone from Trane recommended Respondent. e. David then called Respondent to inquire whether or not Respondent could provide the necessary service and what would be the cost. He initially spoke to Respondent’s telephone receptionist, Dennise Nobby (“Nobby”). He contends that he advised her of his need for a new compressor and inquired about the price. f. According to David, Bill Cater (“Cater”) from Respondent returned his call and advised that the labor cost to replace a compressor under warranty would run approximately $800.00 to $850.00. David further testified that he made arrangements with Respondent to have the necessary service provided on May 30, 2006 and advised Cater that due to the construction of the building a crane would be needed for the installation of the compressor. g. David testified that a technician, named Sean, appeared at Complainant’s building on May 30, 2006, without a crane. Sean advised that he was only there to examine the unit in question and would not be installing a compressor on said date. Notwithstanding the fact that he was disappointed and upset that Respondent would not install the compressor on the May 30 date, David allowed Sean to go on the roof and examine the air conditioner. h. David indicated that Sean advised him, after the inspection of the unit, that not only would a new compressor be needed, but also a reversing valve. The inclusion of the reversing valve significantly increased the cost of the project. i. Sean prepared a work field invoice/report for his visit and this document was entered into evidence. A review of the document shows that the unit had a “bad compressor…system needs R valve as well.” The total amount of this invoice, for the May 30, 2006 examination of the unit, was $113.00. Although Sean had been instructed to have his customers sign the field invoices, he neglected to have David sign the document. j. After Sean’s inspection, Respondent prepared a written bid to perform the work to replace the compressor, along with the reversing valve, and the amount of said bid was $1,736.00. At this point, David became even more unhappy with Respondent, rejected the bid and decided to look elsewhere for the air conditioning repair. k. Evidence of record showed that Complainant retained the services of Accurate Air (“Accurate”) to perform the work. On or about June 8, 2006 Accurate installed the new compressor and did not replace the reversing valve. David testified that the unit has performed properly ever since the remedial work by Accurate was completed. l. On or about June 14, 2006 Complainant received a billing invoice from Respondent for the service call performed on May 30, 2006. The invoice was prepared based on the working field invoice/report prepared by Sean on May 30, 2006. The invoice indicates “call from David to check 5- ton Trane unit that was not working properly. Checked unit and found bad compressor and bad reversing valve…” The total charge for the invoice was $113.00. m. David refused to pay the above referenced invoice from Respondent based his contention that he never requested a service call, only an immediate replacement of the compressor and moreover, since the unit had already been repaired by Accurate, without a reversing valve installation, and was working fine, he believed that Respondent was trying to cheat him. n. Several heated phone calls went back and forth between David and representatives of Respondent, including Respondent’s qualifying party, Michael O’Neill (“Michael”). Without deciding whose conduct was worse, both David and Michael were shown to have quick tempers and neither treated the other with appropriate decorum and civility during their phone conversations. o. After a period of time, when Complainant continued to fail to pay the $113.00 invoice, Respondent turned the billing over to a collection agency. Subsequent to finding out that a collection agency was involved, Complainant filed Complaints against Respondent with the Better Business Bureau and the Registrar of Contractors. p. Complainant entered exhibit no. 3 into evidence. This exhibit is a letter from Accurate, dated April 26, 2007. Among other things, this letter addresses the work that Accurate performed on the air conditioner on June 8, 2006. The letter indicates that the compressor was replaced and a complete check was made on the system, to determine if any other problems were evident with the air conditioner. According to this letter, no other problems were found. q. The aforementioned letter from Accurate, further goes on to state that in the author’s opinion a reversing valve is not required to be replaced every time a compressor is replaced. It must be noted that no one from Accurate appeared to provide live testimony at the instant hearing and the failure to have such testimony at the hearing affected the weight that was given to this documentary evidence. r. Nobby appeared at the instant hearing and testified in regard to her involvement in this matter. She indicated that she took the information from David, wrote up the matter as a service call, and then turned it over to Cater to send a technician to Complainant’s building. s. Cater appeared at the hearing and provided testimony. He has been in the air conditioning business for approximately thirty-five (35) years. According to Cater, if a compressor is “scrambled,” it is Respondent’s policy to always replace the reversing valve, in order to avoid further potential service calls in the future. t. Cater testified that Respondent does not perform major service work without a written proposal and thus, he would never have agreed to replace the compressor without such written signed documentation. He also indicated that Respondent’s employees do not work on a commission basis. u. Mike appeared at the hearing and presented testimony. He has been in the air conditioning repair business for twenty-seven (27) years. He indicated that his company would never rely on the diagnosis of another company for an air conditioning repair project. In addition, he also stated that his company does not perform major repair work without a written signed proposal. v. Mike’s position is that it is very risky not to replace a reversing valve on a “shot” compressor job, since his experience has shown that 75% to 80% of the reversing valve’s will fail after a compressor goes out. He admits that the use of the word “bad” to describe the reversing valve on the June 14, 2006 invoice was a poor choice of words, since they were only recommending replacement of the reversing valve as a precautionary measure, in conjunction with the compressor replacement. Moreover, the original field work order/invoice from Sean did not state that the reversing valve was bad, just that a new one was needed.

3. It is clear from the evidence of record that the parties were operating under a mutual mistake regarding the nature of the work that Respondent would perform for Complainant on May 30, 2006. David believed that he was going to have Respondent change out the compressor on said date and Respondent believed it was coming out to perform a service call to verify the nature of the problem and to support a written bid for the repair work. No reason was shown to disbelieve either party’s assertions in this regard.

4. Complainant never accepted Respondent’s bid to change out the compressor and thus, never incurred any costs to have the reversing valve replaced. Although Complainant had the unit in question repaired, without a reversing valve and it has worked fine ever since, that does not establish any wrongdoing in regard to Respondent’s opinion and company policy to always replace the reversing valve whenever a compressor breaks down. That is Respondent’s opinion and belief and a customer is free to accept it or reject it. It is determined and held that it would not be unusual to find other companies that may have a different opinion in this regard.

5. Respondent was not shown to have acted unreasonably in billing Complainant for the May 30, 2006 service call and/or turning the unpaid bill over to a collection agency. Nothing in Respondent’s overall conduct in this matter is found to rise to the level of a violation of the spirit and intent of the State’s Contracting laws.

CONCLUSIONS OF LAW

1. Complainant has the burden of proof and must establish statutory violations by a preponderance of the evidence. A.A.C. R2-19-119. Proof by “preponderance of the evidence” means that it is sufficient to persuade the finder of fact that the proposition is “more likely true than not.” In re Arnold and Baker Farms, 177 B.R. 648, 654 (9th Cir. BAP (Ariz.) 1994). 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 (rev. 6th ed. 1990).

2. Complainant failed to sustain his burden of proof to establish that Respondent violated the applicable charged sections of the State’s Contracting laws. Therefore, the evidence of record did not sufficiently sustain a finding of violations by Respondent of the provisions of A.R.S. §32-1154A, as charged in the Citation.

RECOMMENDED ORDER

Based on the foregoing, it is hereby recommended that this Citation (no. 07-0820), 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 in this matter will be forty (40) days from the date of that certification.

Done this day, May 9, 2007.

______________________________________ Mark A. Silver Administrative Law Judge

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

Registrar of Contractors Fidelis V. Garcia 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