ALJDEC decisions subject to certification as final

09F-0518-ROC · Registrar of Contractors · 2009-09-01

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 13, 2009. APPEARANCES: Kimberly Noel Sorkilmo appeared personally. Aaron Grote Construction, Inc. was represented by its attorney, Manny Bustamante, 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. Aaron Grote Construction, Inc. (“Respondent”) is the holder of License No. 165042, a Class B- contracting license issued by the Registrar of Contractors (“Registrar”). 2. Kimberly Noel Sorkilmo (“Complainant”) filed a written Complaint with the Registrar alleging that Respondent would not return her first progress payment of $10,000.00 paid to Respondent under a construction contract. The Registrar designated the Complaint as Case No. 09-0518. 3. The Registrar issued a Citation and Complaint in Case No. 09-0518 alleging possible violations by Respondent of A.R.S. § 32-1154(A) (7) and (13), namely A.R.S. § 32-1124(B). 4. The Registrar forwarded Case No. 09-0518 to the Office of Administrative Hearings, an independent agency, for formal hearing. 5. Complainant purchased a vacant lot located at 37038 North 23rd Avenue, Phoenix, Arizona from a third party. 6. Respondent submitted a proposal dated September 21, 2007, to Complainant for the construction of a single-family residence on the subject lot. 7. Respondent’s proposal did not list its contracting license number. 8. On March 14, 2008, Complainant accepted Respondent’s proposal. 9. Pursuant to the terms of the proposal, Complainant paid Respondent a first draw in the amount of $10,000.00. The first draw covered the following scope of work: “plans, permitting and initial fees required to submit plans to Maricopa County.” 10. Respondent began performing work on the project in October 2007, prior to Complainant’s acceptance of its proposal. 11. Complainant breached the contract with Respondent because the expenses for engineering and land development necessary for constructing a residence became prohibitive for her. Complainant made a demand to Respondent for the return of her $10,000.00 first draw paid to Respondent. 12. Respondent objected to the return of the $10,000.00 payment because it had incurred expenses for work performed within the scope of the first draw. 13. Complainant purchased a second lot, upon which she intended to build a residence. She offered Respondent the opportunity to construct a residence on the new lot, but Respondent declined the offer. 14. The proposed construction on the two lots by Complainant involved two separate projects. Respondent had no contractual obligations regarding the second project. 15. Respondent’s refusal to return Complainant’s first draw payment after her breach of contract is found not to be a wrongful act that substantially injured Complainant. On the contrary, Respondent may be entitled to damages as a result of Complainant’s breach of contract. 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 a conclusion that Respondent violated the provisions of A.R.S. § 32-1154(A) (7), as cited in the Citation and Complaint issued by the Registrar. The Administrative Law Judge concludes that Complainant failed to sustain her burden of proof on this allegation. 4. Respondent violated the provisions of A.R.S. § 32-1154(A) (13), specifically A.R.S. § 32-1124(B), as cited in the Citation and Complaint issued by the Registrar. Respondent failed to list its contracting license on the parties’ proposal and a document admitted into evidence as Exhibit 3. RECOMMENDED ORDER Respondent’s License No. 165042 shall be suspended on the effective date of the Order entered in Case No. 09-0518 until the Registrar receives written proof, and approves such proof, that Respondent has become fully compliant with the requirements of A.R.S. § 32-1124(B). If Respondent’s provides the Registrar with written proof that it has become fully compliant with the requirements of A.R.S. § 32-1124(B) on or before the effective date of the Order entered in Case No. 09-0518, and the Registrar approves such proof, then the above-provided license suspension shall not take place, and the Citation and Complaint in Case No. 09-0518 shall 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, September 1, 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 ___________________________

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