ALJDEC decisions subject to certification as final

08F-1825-ROC · Registrar of Contractors · 2009-04-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 1, 2009. APPEARANCES: 442 Construction, Inc. was represented by its authorized representative, Chris Levenhagen. Niche Contractors, Inc. was represented by its attorney, Hank Pearson, Esq. 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. 442 Construction, Inc. (“Complainant”) is the holder of License No. 223542, a Class A- contracting license, issued by the Registrar of Contractors (“Registrar”). 2. Niche Contractors, Inc. (“Respondent”) is the holder of License No. 175488, a Class B-01 contracting license, issued by the Registrar. 3. Complainant filed a written Complaint with the Registrar alleging non- payment by Respondent for work performed on its behalf by Complainant. The Registrar designated the Complaint as Case No. 08-1825. 4. The Registrar issued a Citation and Complaint in Case No. 08-1825 alleging possible violations by Respondent of A.R.S. § 32-1154(A) (7) and (11). 5. The Registrar forwarded Case No. 08-1825 to the Office of Administrative Hearings, an independent agency, for an evidentiary hearing. 6. Respondent was hired to supply power for ADOT modular units at the Jackson Street Modular Complex in Phoenix, Arizona. 7. Respondent entered into a written Subcontract dated January 17, 2007 with Complainant. 8. Pursuant to Exhibit G of the Subcontract, Complainant agreed to perform the following scope of work for Respondent: “Scope of work: 442 Construction is to provide all necessary labor, material and equipment to complete catch basin, dumpster pad, (4) bollards @ dump pad, (4) bollards @ bldg. corner, as per the plans and spec and as per your proposal dated 12/27/06.” 9. Respondent also subcontracted with Winifred Electric, Inc. for electrical work, who later abandoned its scope of work and went out of business. 10. Complainant had also entered into a subcontract with Winifred Electric, Inc. 11. Winifred Electric’s abandonment of its contractual obligations owed to Respondent resulted in an additional cost of $117,000.00 to Respondent in order to complete the former’s scope of work. 12. Complainant claims that Respondent owes it the total sum of $16,604.28, which included money owed to Complainant by Winifred Electric, Inc. 13. Complainant accepts the premise that it is owed what ADOT paid Respondent.[1] 14. Respondent is not responsible for the cost of Complainant’s work performed for Winifred Electric, Inc., which the latter failed to pay. 15. Numerous work items and related costs submitted by Complainant were rejected by ADOT, either because of workmanship issues or because the work was included in the base bid. 16. Respondent received payment from ADOT for Complainant’s scope of work under the parties’ Subcontract. Respondent admitted that it owes Complainant the sum of $460.79 received from ADOT for Complainant’s scope of work with Respondent. 17. Respondent is found to have tendered to Complainant the remaining balance of $460.79 received from ADOT. Complainant has refused to accept payment of that amount from Respondent.

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), Complainant has the burden of proof in this matter. The standard of proof is preponderance of the evidence. A.A.C. R2-19-119(A). 3. The evidence of record does not support the allegation that Respondent violated the provisions of A.R.S. § 32-1154(A) (11), as cited in the Citation and Complaint issued by the Registrar. The record established that Respondent has paid Complainant for its work from funds paid by ADOT, with the exception of tendered but not accepted payment of $460.79. This amount owed to Complainant is less than the statutory requirement that the debt be in excess of $750.00. Complainant has rejected Respondent’s tender of that amount. Respondent is not responsible for any money owed to Complainant by Winifred Electric, Inc. 4. The evidence of record does not establish a factual basis to support the allegation that 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 The Citation and Complaint in Case No. 08-1825 shall be dismissed on the effective date of the Order entered in this matter. 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, April 21, 2009

______________________________________ Brian Brendan Tully Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2009, to:

William A. Mundell, Director Registrar of Contractors c/o Legal Department 3838 N. Central Ave. Phoenix, AZ 85012

By ___________________________

----------------------- [1] The Subcontract contains a “pay when paid” provision.

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

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