ALJDEC decisions subject to certification as final

09F-0623-ROC · Registrar of Contractors · 2009-10-09

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 9, 2009 at 10:00 a.m. APPEARANCES: Complainant Brooks Bros Utility Contractors Inc. appeared through Candy Cox, its Project Manager; Respondent G Mac Sales Inc. did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT On July 21, 2000, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC157328, Class K-11 for dual electrical contracting to Respondent G Mac Sales Inc., a corporation. Respondent’s address of record is 6501 E. Greenway Parkway, #102-190, Scottsdale, AZ 85254. On October 17, 2000, the Registrar issued License No. ROC159264, Class A- for commercial general engineering to Complainant Brooks Bros. Utility Contractors Inc., a corporation. On July 31, 2008, the Registrar received a complaint from Complainant against Respondent’s license, which alleged that Respondent owed $5,590.00 for Complainant’s “install[ation of] 4) 35’ md galvanized DB poles W/6’ ARM & 250 W. Cobrahead” at the 35th Avenue Mini Storage job at 35th Avenue and Broadway in Phoenix, Arizona. The Registrar referred the complaint to Respondent for its immediate attention. On December 8, 2008, the Registrar informed Respondent in relevant part as follows: We have received information that you are operating beyond the scope of your Arizona contractor’s license.

Our records indicate you have a current class K-11 ELECTRICAL license. However, we have information indicating you are performing or offering to perform work which would be covered under the scope of a class A-17 ELECTRICAL license regarding CONTRACTOR HIRE A- CONTRACTOR TO PERFORM WORK WHICH K-11 LICENSEE IS NOT PERMITTED TO PERFORM AT 35TH AVE & BROADWAY RD, PHOENIX, AZ.

On October 28, 2008, the Registrar received Complainant’s request for hearing. On April 13, 2009, the Registrar issued a Citation and Complaint against Respondent’s license, charging A.R.S. § 32-1154(A)(7), (11), and (17). The Registrar mailed a copy of the Citation and Complaint to Respondent via certified mail at its address of record. On April 28, 2009, the Registrar received Respondent’s attorney’s written answer to the Citation and Complaint, which denied any statutory violation and affirmatively alleged that Respondent had attempted to send a check to Complainant, but the envelope had been returned because there was “no such address.” The Registrar referred the matter to the Office of Administrative Hearings, an independent agency, to schedule and to conduct a fair hearing.

On July 31, 2009, the Registrar issued a Notice of Hearing setting a hearing on October 9, 2009 at 10:00 a.m. in the Office of Administrative Hearings. The Registrar mailed the Notice of Hearing via certified mail to Respondent at its address of record. The Registrar’s record shows that, on September 15, 2009, Cecil Eugene Mc Dole resigned as Respondent’s qualifying party. On September 21, 2009, the Registrar suspended Respondent’s license for lack of bond. A hearing was held on October 9, 2009 at 10:00 a.m. Complainant’s representative appeared, testified, and submitted three exhibits at the duly noticed hearing. Although the beginning of the hearing was delayed fifteen minutes to allow Respondent additional travel time, it did not contact the Office of Administrative Hearings to request that the hearing be continued or that the start of hearing be further delayed and did not appear through an authorized employee or attorney. Respondent did not present any evidence to defend its license. Complainant’s representative testified that, on February 7, 2008, the parties had entered into a contract for Respondent to perform the work for $4,890.00. The contract, which was attached to Complainant’s complaint, excluded J-Boxes. Respondent subsequently issued a change order for Complainant to install the J-Boxes, at an additional cost of $600.00. Complainant also attached to its complaint the change order and its invoice for the completed work. Complainant’s representative testified that Complainant completed the work pursuant to the subcontract and change order. Complainant submitted copies of Respondent’s unconditional lien waiver for the project, which was signed on March 18, 2008, and of a check dated March 17, 2008 issued by the general contractor for the project, Asset Construction Services II LLC, to Respondent in the amount of $29,701.00 for its work on the project. Complainant’s representative testified that in July 2008 she had called “Gene,” Respondent’s president, and asked about payment. “Gene” told her that Respondent had sent Complainant a check, but the check had been returned. Complainant’s representative testified that she offered to go to Respondent’s office to retrieve the check, but “Gene” said Respondent was in the process of moving and that everything was “in boxes.” Over the next two months, “Gene” either did not return voicemails and e-mails or stated that Respondent had not unpacked the boxes. In September 2008, after Complainant had filed its complaint to the Registrar, Complainant’s accounts receivable clerk contacted “Gene.” According to her notes, “Gene” became “very nasty” and said that his attorney would contact Complainant. “Gene” told the clerk that, since Complainant had filed a complaint to the Registrar, Respondent would never pay. The Registrar’s record shows that Respondent’s license remained suspended on the date of the hearing. CONCLUSIONS OF LAW 1. The notice of the hearing that the Registrar mailed to Respondent at its address of record was reasonable and it is deemed to have received it.[1] 2. Complainant bears the burden of proof and must establish statutory violations by a preponderance of the evidence.[2] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[3] A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”[4] 3. A.R.S. § 32-1154(A)(11) specifically includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[f]ailure by a licensee . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee’s operations as a contractor when the licensee has the capacity to pay . . . .” Although Complainant may also file a civil complaint in a judicial forum for Respondent’s breach of contract in failing to pay monies owed when due, the Arizona legislature has also made non-payment a violation of state contracting law.

4. Respondent has never disputed that it owes $5,590.00 to Complainant for the parties’ subcontract. Complainant therefore has borne its burden to establish that Respondent violated A.R.S. § 32- 1154(A)(7)[5] and (11) by failing to pay Complainant $5,590.00. 5. No evidence was presented at the hearing regarding the charged violation of A.R.S. § 32-1154(A)(17).[6] 6. The suspended status of Respondent’s license does not preclude Complainant from pursuing its administrative remedy nor preclude the Registrar from conducting these disciplinary proceedings.[7] If Respondent fails to comply with any condition that the Registrar sees fit to include in his final Decision and Order in this matter, its suspended license will be revoked. 7. If the Registrar accepts this recommendation and, as a result of Respondent’s failure to comply with the Registrar’s final decision in this matter, the Registrar revokes Respondent’s license, the revocation in due course will lead to revocation of any other license on which Respondent or anyone on its license may be listed[8] and may prevent any new license from being issued to Respondent or anyone on its license, including its former qualifying party.[9] RECOMMENDED ORDER Based on the contracting law violations that were proven in this matter, it is recommended that, on the effective date of the final order in this matter, the Registrar of Contractors revoke License No. ROC157328, Class K-11 previously issued to Respondent G Mac Sales Inc. It is further recommended that, if before the effective date of the order, the Registrar receives proof from Respondent that it has paid $5,590.00 to Complainant Brooks Bros. Utility Contractors Inc. by cashier’s or certified check, the Registrar shall not revoke Respondent’s license but, instead, shall close the complaint in Case No. 09-0623. If the Director of the Office of Administrative Hearings certifies this Administrative Law Judge Decision, the effective date of the order will be forty days from the date of certification. Done this day, October 9, 2009.

______________________________________ Diane Mihalsky Administrative Law Judge

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

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

By ___________________________ ----------------------- [1] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [2] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119; see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [3] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [4] Black’s Law Dictionary at page 1220 (8th ed. 1999). [5] This statutory subsection includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license “[t]he doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured.” [6] This statutory subsection includes among the grounds for suspension, revocation, and other disciplinary action against a contractor’s license “[k]nowingly contracting beyond the scope of the license or licenses of the licensee.” [7] See A.R.S. § 32-1154(C). [8] See A.R.S. § 32-1154(A)(21). [9] See A.R.S. § 32-1122(E).

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