ALJDEC decisions subject to certification as final

07F-2359-ROC · Registrar of Contractors · 2008-02-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: February 12, 2008 APPEARANCES: Complainant was represented by Mr. Joe Bernas, its chief engineer; Respondent was represented by Mr. Rick Lujan, its managing member. ADMINISTRATIVE LAW JUDGE: Thomas Shedden _____________________________________________________________________ The issue presented is whether Respondent Arizona Mechanical Solutions LLC is subject to discipline for acts or omissions in violation of A.R.S. § 32- 1154. Based on the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order: FINDINGS OF FACT Arizona Mechanical Solutions, LLC (“Respondent”) is the holder of a Class K- License (No. 223406) issued by the Registrar of Contractors (“ROC”). Ricardo Lujan is Respondent’s managing member.

Nobeus Property Management (“Complainant”) hired Respondent to replace the compressor on a chiller unit at the building located at 5045 North 12th Avenue, Phoenix, Arizona. Joe Bernas is Complainant’s chief engineer. On November 23, 2006, Respondent replaced the compressor with a remanufactured compressor. On April 16, 2007 Complainant, through Mr. Bernas, filed a Complaint against Respondent alleging that the compressor seal was leaking and Respondent was not willing to repair that leak. Complainant also alleged that Respondent had twice repaired compressor-seal leaks soon after the compressor was installed, but did not respond to Complainant’s requests for the third repair. On July 27, 2007 ROC issued a Citation and Complaint No. 07-2359 charging that Respondent may have violated A.R.S. § 32-1154(A)(1), (A)(7) and (A)(3)(R4-9-108). Respondent filed a Written Answer to Citation and Complaint (the “Answer”) asserting that the compressor was not under warranty because Complainant had not approved additional work that was required to determine the reason that the old compressor failed and because Complainant had not approved the required preventative maintenance. ROC issued a Notice of Hearing on October 30, 2007. The matter was continued and convened on February 12, 2008. Mr. Bernas and Mr. Randy Lujan each testified. Complaint had introduced into evidence 2 exhibits and Respondent had entered into evidence 5 exhibits. Mr. Lujan testified that Respondent had informed Mr. Bernas that the compressor warranty would be void if Complainant did not authorize Respondent to conduct additional work that was never approved. According to Mr. Lujan, because the existing compressor had failed, this additional work was required to determine the cause of the failure. Exhibit R1 is a proposal that states that Respondent will not be able to honor the compressor warranty unless the entire chiller system is checked for operation, which system check would be on a time and materials basis. Exhibit R2, the invoice for the work at issue does not have the same limitation. Exhibit R3 consists of 3 emails from John Pomeroy, who was Respondent’s qualifying party during the time at issue, to Mr. Bernas. The emails tend to support Mr. Lujan’s testimony that Mr. Bernas had been informed that additional work would be required to determine the cause of the original compressor failure and to keep the warranty in effect, but only one of the emails was written before the new compressor was installed, which limits the evidentiary value. Exhibit R4 is a copy of the warranty from Quality Compressor Inc. that supplied the remanufactured compressor. That warranty cautions that the cause of failure of the existing compressor should be determined when the replacement is installed, or else the replacement is likely to fail as well. Mr. Bernas testified that he did not receive the proposal (Exhibit R1) or the emails (Exhibit R3) until after the new compressor was installed. On April 25, 2007, Mr. Bernas sent a fax to ROC Inspector Scott Deering in which Mr. Bernas writes that he did not receive the proposal because the replacement was done on an emergency basis and his dealings with Mr. Pomeroy were all verbal. Mr. Pomeroy did not appear or testify at the instant hearing. Mr. Bernas renewed the allegations presented in the Complaint and questioned why Respondent would have repaired the seals twice if not covered by warranty. Mr. Lujan explained that Respondent had done so because it was interested in obtaining a maintenance contract to provide additional service to Complainant. Exhibit C1 is a January 31, 2008 estimate from Trane Building Services to replace the compressor seal, but that that estimate does not provide any information to show what caused the seal to leak, and in fact does not even explicitly show that there is a seal leak or when any leak occurred. Consequently, Exhibit C1 one is of limited weight. CONCLUSIONS OF LAW Generally the party asserting a claim or right bears the burden of proof at an administrative hearing. The standard of proof is that of the preponderance of the evidence. See A.A.C. R2-19-119. A preponderance of the evidence is “[e]vidence 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). Under A.R.S. § 32-1154(A)(1), a contractor is subject to discipline for “abandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” Under A.R.S. §32-1154(A)(7), a contractor is subject to discipline for “the doing of a wrongful or fraudulent act…resulting in another person being substantially injured.” Under A.R.S. §32-1154(A)(3), a contractor is subject to discipline for “violation of any rule adopted by the Registrar.” In this case, the ROC charged Respondent with violating A.A.C. R4-9-108, which, among other things, requires contractors to perform work in a professional and workmanlike manner and in accordance with professional industry standards. Complainant has not met the burden of proof to show that Respondent committed the alleged violations. Mr. Bernas’s fax to Inspector Deering shows that the work was conducted on an emergency basis and, consequently, it is possible that there was a miscommunication or lack of understanding as to the scope of any warranty, but Complainant has not proven that the seal at issue is covered by a warranty. Because there is no proven violation of A.R.S. § 32-1154 the Complaint in this matter should be closed. RECOMMENDED ORDER IT IS RECOMMENDED that no discipline be imposed on Respondent’s Class K-39 License No. 223406, and that Citation No. 07-2359 and the Complaint upon which it is based should be closed. 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, February 29, 2008

______________________________________ Thomas Shedden Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2008, to:

Fidelis V. Garcia, Director Registrar of Contractors 3838 N. Central Ave. Phoenix, AZ 85012

By ___________________________

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