ALJDEC decisions subject to certification as final

08F-M1020-ROC · Registrar of Contractors · 2008-11-25

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 17, 2008 APPEARANCES: Robert Harrah and Skylar Cook appeared on behalf of Complainant S A K Electric and Plumbing, Inc. Respondent Jackson Properties Development, Inc. failed to appear. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The issue presented by this matter is whether Respondent Jackson Properties Development, Inc. (“Jackson”) is subject to discipline for acts or omissions in violation of A.R.S. § 32-1154(A). Based on the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law and Recommended Order: Procedural Background On October 15, 2008, the Registrar of Contractors issued a Notice of Hearing advising the parties that the scheduled hearing in this matter would convene on November 17, 2008 at 9:00 a.m. On the date and at the time scheduled for the hearing, Robert Harrah and Skylar Cook appeared on behalf of Complainant S A K Electric and Plumbing, Inc. (“SAK”). No one appeared on behalf of Jackson. The Administrative Law Judge delayed the commencement of the hearing for approximately fifteen minutes to allow for the appearance of Jackson, or the receipt of any information that would constitute good cause for Jackson’s absence or delay. No such information was received. Therefore, the hearing proceeded in Jackson’s absence. FINDINGS OF FACT Jackson is the holder of a Class B-01 license (No. 136562) issued by the Registrar of Contractors (“ROC”).[1] Jackson contracted with SAK for SAK to perform the plumbing and concrete work at Falcon Jet Center in Mesa, Arizona. The contract price for the concrete work was $322,710.00. See Exhibit 1. According to the filed complaint, the contract price for the plumbing work was $82,730.27. The parties’ contracts specify that survey work is excluded from the scope of SAK’s work. Mr. Cook, SAK’s concrete manager, credibly testified at hearing that Jackson’s engineer initially surveyed the corners of the building, however, the survey was incorrect. As such, when SAK installed the concrete piers, they were “off”. SAK contacted the engineer, who responded to SAK’s inquiry by stating that they corners were “rough” not “actual” corners. Jackson was to have the engineer return to survey actual corners, however, Jackson recommended that SAK retain its own engineer to perform a survey. SAK retained an engineer who determined that the initial survey points were incorrect as they were 1 5/8” off center causing a “dog leg” to the right. SAK was compelled to remove and re-install the concrete piers, making the necessary adjustments in order to render the building square. SAK performed the remainder of its work within the scope of its contracts with Jackson. Jackson paid SAK in full for the concrete work, however, withheld $7,680.00 from the plumbing contract amount as an offset/back charge for the additional survey work. On or about December 11, 2007, SAK filed a complaint against Jackson with the ROC, alleging that Jackson is “withholding money for others mistake” and has failed to pay SAK in the amount of $7,680.00. The Administrative Law Judge finds, based on the weight of the credible evidence of record, that the sum of $7,680.00 is the proper balance due and owing to SAK from Jackson for the work performed by SAK on the project, as survey work is not within the scope of the parties’ contracts, thus SAK should not be held liable for the expense of the additional survey work that was required. Notwithstanding repeated attempts and billings over a prolonged period of time, said balance remains unpaid. CONCLUSIONS OF LAW 1. In this proceeding, Jackson is subject to discipline for violations of A.R.S. § 32-1154(A)(7) and/or (A)(11) as charged by the ROC in its June 18, 2008 Citation and Complaint. See Arizona Administrative Code R2-19-119. 2. 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). 3. The Administrative Law Judge concludes that SAK met its burden of proof as to both of the ROC charges. 4. Under A.R.S. § 32-1154(A)(11), a contractor is subject to discipline for the “failure . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered . . .” The instant record demonstrates that Jackson failed to pay, when due, the sum of $7,680.00 to SAK. Accordingly, under all of the facts and circumstances presented herein, Jackson’s conduct is found to constitute a violation of A.R.S. § 32-1154(A)(11). 5. 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, from the evidence presented, that Jackson committed a wrongful act that substantially injured SAK by failing to pay for all of the work performed by SAK. Therefore, Jackson violated A.R.S. § 32-1154(A)(7). 6. Based upon the above violations of the provisions of A.R.S. § 32- 1154(A), grounds exist to impose discipline against Jackson’s license. 7. Upon consideration of all of the facts and circumstances presented by this case, including Jackson’s failure to appear for hearing and Jackson’s canceled license status, the Administrative Law Judge concludes that Jackson’s Class B-01 license should be suspended. 8. The ROC’s authority in disciplinary matters such as the one presented herein includes the ability to impose reasonable conditions that allow the disciplined contractor to reduce the scope of the disciplinary action taken against it. The Administrative Law Judge deems the exercise of such authority to be appropriate in the instant case, and preferable to imposing discipline against Jackson’s license without providing a condition to reduce or eliminate same. 9. Upon consideration of all of the facts and circumstances presented by this case, the Administrative Law Judge concludes that the ROC should suspend Jackson’s Class B-01 license subject to the condition that Jackson can avoid such suspension by paying the sum of $7,680.00 to SAK. RECOMMENDED ORDER Based on the foregoing, the Administrative Law Judge makes the following Recommended Order: On the effective date of the Order entered in this matter, Jackson’s Class B-01 license (No. 136562) shall be suspended until the ROC receives written proof that Jackson has paid the sum of $7,680.00 to SAK. It is further recommended that if Jackson complies with the above- described condition on or before the effective date of the Order entered in this matter, then the aforementioned license suspension shall not take place. 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, November 25, 2008.

______________________________________ Sondra J. Vanella Administrative Law Judge

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

Armando Contreras, Director Registrar of Contractors 3838 North Central Avenue Phoenix, AZ 85012

By ___________________________

----------------------- [1] A review of the ROC’s official records revealed that Jackson’s contracting license was canceled on June 9, 2008. Such canceled license status does not preclude this tribunal from conducting these administrative proceedings. A.R.S. § 32-1154(C).

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