ALJDEC decisions subject to certification as final

07F-2060-ROC · Registrar of Contractors · 2007-11-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 6, 2007. APPEARANCES: Patrick Manning and Melissa Murray appeared personally. Stewart Greenfield Designs, L.L.C. was represented by its member and qualifying party, Stewart Greenfield. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________ Based upon the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order:

FINDINGS OF FACT

1. Stewart Greenfield Designs, L.L.C. (“Respondent”) is the holder of License No. 221644, a Class B-03 contracting license, issued by the Registrar of Contractors (“Registrar”). 2. On or about December 1, 2006, Patrick Manning and Melissa Murray (“Complainants”) entered into a remodeling contract with Respondent. 3. Pursuant to the parties’ agreement, Complainants were to supply some items for installation by Respondent, and Respondent was to supply and install specified items. 4. At the time the parties entered into the contract, they were aware that Respondent’s member and qualifying party, Stewart Greenfield, would be on an extended vacation during the term of the project. 5. Respondent commenced work prior to Mr. Greenfield’s vacation. 6. After Mr. Greenfield went on vacation, problems developed between Complainants and Respondent’s workers and subcontractors. 7. On or about February 9, 2007, Respondent demanded that Complainant make the final draw payment or Respondent would not perform the remaining work. Complainants refused to pay the final draw at that point in time. Respondent left the project and refused to perform any additional work remaining under its scope of work. 8. There is credible evidence that Respondent’s scope of work was 75% to 80% completed at the time it left the project. 9. The parties’ contract contains the following provision regarding the final payment:

Final payment shall be due upon substantial completion of the work. After the installation is substantially completed a “Walk- through” shall then be scheduled with the owner or designated representative and [Respondent]. A walk-through and a Final Punch List will be created of any detail items needing to be completed. The client will be asked to acknowledge the final list and sign where indicated. Please note that due to the complexity of some contract items listed on the Punch List that have not been contracted for shall not be considered as necessary to complete. Upon completion of the work itemized on the Final Punch List, the homeowner will sign off as being completed. (Emphasis in the original).

10. The parties’ contract also contains the following provision concerning the payment schedule:

It should be clearly understood that if the payment schedule outlined in this contract is not adhered to, the contractor shall have the right to “shut down” the jobsite construction. The construction shall not begin again until all payments due are received by [Respondent].

11. Respondent was not entitled to the final payment because its scope of work had not been substantially completed. There is credible evidence that the job was 75% to 80% completed when Respondent left the job. No walk-through had been performed as required by the contract. Respondent left the job because it anticipated that Complainants would not pay it upon completion of its scope of work. Complainants denied that they planned not to pay the final payment per the contract. 12. Respondent is found to have abandoned Complainant’s project without legal justification. Therefore, Respondent was not permitted to “shut- down” the project until the final payment was paid. Respondent was contractually obligated to wait until substantial completion of its work, per the contract. If Respondent was not paid the final payment as required by the contract, it had legal remedies available to seek payment. 13. Respondent’s abandonment of the project without legal justification is a wrongful act that substantially injured Complainants. 14. The Registrar’s official records reveal that Complainant’s Complaint is the only one against Respondent’s contracting license.

CONCLUSIONS OF LAW

1. The Registrar has jurisdiction over Respondent and the subject matter in this case. 2. Pursuant to A.A.C. R2-19-119(B), Complainants have the burden of proof in this matter. The standard of proof is preponderance of the evidence. A.A.C. R2-19-119(A). 3. Respondent violated the provisions of A.R.S. § 32-1154(A) (1), as cited in the Citation and Complaint issued by the Registrar. 4. Respondent violated the provisions of A.R.S. § 32-1154(A) (7), as cited in the Citation and Complaint issued by the Registrar.

RECOMMENDED ORDER

Respondent’s License No. 221644 shall be suspended on the effective date of the Order entered in Case No. 07-2060 until the Registrar receives written proof, and accepts such proof, that Respondent has completed its scope of work on Complainants’ project, including change order items, to minimum workmanship standards. If Respondent has completed its scope of work on Complainants’ project to the satisfaction of the Registrar on or before the effective date of the Order entered in Case No. 07-2060, then the above license suspension shall not take place. In addition to the indefinite license suspension, if any, Respondent’s contracting license shall be placed on probation for a period of 120 days commencing on the effective date of the Order entered in Case No. 07-2060 or the date on which the Registrar approves Respondent’s notice of compliance with this Order, whichever is later. 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, November 21, 2007

______________________________________ Brian Brendan Tully Administrative Law Judge

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

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

By ___________________________

-----------------------

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