ALJDEC decisions subject to certification as final

09F-2131-ROC · Registrar of Contractors · 2009-08-24

STATE OF ARIZONA OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: August 4, 2009

APPEARANCES: Complainant was represented by its President Robert Singh; Respondent was represented by Member Bryan Berry, accompanied by Member Roxanne Berry.

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant Madera Component Systems brings this action to force Respondent Triple B Builders to pay a remaining balance due for construction materials supplied by Complainant to Respondent. Respondent denies that any further payment is due. This tribunal entered the complaint file received from the Registrar of Contractors into the record. The parties presented evidence and testimony at the hearing. Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Decision finding that Respondent has wrongfully withheld money due to Complainant. FINDINGS OF FACT 1. Respondent is the holder of a class B- general residential contractor license (No. ROC183760) issued by the Registrar of Contractors (“ROC”). That license authorizes Respondent to perform general residential construction of a structure or appurtenance, except for certain specialty contracting such as electrical, plumbing, swimming pools, etc.[1] 2. Complainant is material supplier. In September 2007, Respondent entered into a contract with Complainant for roof trusses for five buildings on a townhouse project that Respondent was building. The contract was signed by both parties. Each building is listed in the contract with a separate price of $16,430.00 per building for the trusses. The total contract price is $82,150.00. 3. The contract between the parties contains several terms that are noteworthy in this case. One of these noteworthy terms is that no oral or verbal agreements between the parties was valid, unless put in writing and made part of the written agreement.[2] Further, the parties agreed that “because the material which is the subject of this agreement will be custom made, this agreement may be cancelled only by consent of all parties. . . .”[3] 4. Complainant built the trusses for the first building and on October 9, 2007 they were delivered to the jobsite. Complainant immediately began building the trusses for the second building, for delivery as soon as possible. However, after the second building’s trusses were built, but before delivery, there were problems and delays at the jobsite and Respondent did not want the trusses. 5. Complainant consented to cancellation of the trusses for the three remaining buildings, but expected payment for the second building’s trusses, which had been built and were ready for delivery. Respondent paid for the first building. However, Respondent refused to pay for the second building, claiming that the second building was never “authorized” by Respondent and that the trusses should not have been built until such authorization was given. 6. In April 2008, half of the second building was paid for. Complainant seeks payment for the second half of the price of the second building at $8,215.00. This is the remaining balance that Complainant claims is due. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[4] Further, the standard of proof at hearing is by preponderance of the evidence.[5] Therefore, Complainant bears the burden of showing, by a preponderance of the evidence, that Respondent has violated the statutes cited in the Citation and Complaint.[6] Complainant has met that burden. 2. The evidence shows that $8,215.00 is due and owing by Respondent to Complainant for the second building. This is a violation of Arizona Revised Statutes (“A.R.S.”) § 32-1154(A)(11) for failure to pay more than $750.00 when due for materials rendered in connection with Respondent’s operation as a contractor. 3. Respondent’s argument that Complainant should have waited until Respondent gave authorization before building the second building’s trusses is not supported by persuasive evidence. Nothing in the written agreement provides for an authorization procedure. A process for cancellation of the agreement is stated in the written agreement, and that section provides that upon cancellation Complainant is entitled to payment for the materials provided before cancellation. 4. Here, the agreement was cancelled by mutual agreement after the second building’s trusses were completed. Thus, Complainant is entitled to payment for the second building.[7] 5. Respondent must pay the unpaid portion of the second building in the amount of $8,215.00. RECOMMENDED ORDER IT IS RECOMMENDED that Class B- license ROC183760, held by Respondent Triple B Builders, LLC be suspended beginning the effective date of the Registrar’s Order until Respondent provides written proof of payment of $8,215.00 to Complainant and the Registrar of Contractors accepts such written proof. IT IS FURTHER RECOMMENDED that if Respondent makes full payment on or before the effective date of the Registrar’s Order, the 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 will be 40 days from the date of that certification.

Done this 24th day of August 2009.

Office of Administrative Hearings

______________________________ Eric A. Bryant Administrative Law Judge

Copy mailed this ___ day of August 2009 to:

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

By ___________________________ ----------------------- [1] See, Arizona Revised Statutes (“A.R.S.”) § 32-1102 and Arizona Administrative Code (“A.A.C.”) R4-9-103 for a description of license classifications. [2] Paragraph 9. [3] Paragraph 5. [4] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [5] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [6] See Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996) (moving party bears burden of proof by preponderance of evidence in an administrative hearing). [7] Likewise, Respondent is entitled to possession of the trusses upon payment.

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