ALJDEC decisions subject to certification as final

09F-4235-ROC · Registrar of Contractors · 2009-10-09

STATE OF ARIZONA OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 23, 2009

APPEARANCES: Complainant appeared on her own behalf; Respondent was represented by its President and Qualifying Party Chris Wiens.

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant brings this action alleging wrongful conduct by Respondent because Respondent told a loan company that he was owed money by Complainant. Respondent denies any wrongful conduct. This tribunal entered the complaint file received from the Registrar of Contractors into the record. The parties presented evidence and each party testified at the hearing. Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Decision finding no violation of the cited law. FINDINGS OF FACT 1. Respondent is the holder of a class B- general residential contracting license (No. 126743) issued by the Registrar of Contractors (“ROC”). The license authorizes Respondent to operate as a general contractor for residential projects.[1] Chris Wiens is Respondent’s President and Qualifying Party. Hereinafter “Respondent” will refer to either the company or Chris Wiens or both, depending on context. 2. Complainant experienced a fire at her house and needed major renovation work. In June 2008, Respondent drafted an agreement for the work at a price of $208,500.00. With Complainant’s urging, Respondent allowed Complainant to inform the mortgage company from which she was seeking a loan to make the renovations that Respondent was the contractor of record for the project, even though Complainant had not yet signed a contract with Respondent. The file contains a tax identification document for the project, showing Respondent as the contractor, and a conditional lien waiver from Respondent. Complainant testified that she intended to use Respondent as the contractor for the work. However, when her insurance proceeds were less than she had hoped, she decided not to accept Respondent’s proposed contract. 3. During a telephone conference call between Complainant, Respondent, and a representative of Complainant’s mortgage company in February 2009, Complainant informed Respondent that he would not be the contractor for the job and requested a lien waiver. Respondent did not have a lien on the property at that time and there is no evidence that he does now. The mortgage company representative asked Respondent if he had done any work on the project. He replied that he was owed $2,500.00 for consulting and preparation for the bid on the project. For this reason, the mortgage company would not release the funds to Complainant until that issue was resolved. 4. Complainant claims that Respondent’s statement that money was owed by Complainant is a wrongful act that harmed her. This is the basis for her complaint. 5. Respondent testified at the hearing that his claim for a consulting and preparation fee is based on the substantial time and expenses that he put into talking with Complainant about how to proceed with the project and preparing the contract that was offered to Complainant. He gave credible testimony as to the work that was involved. 6. This tribunal finds that Respondent has a good faith claim to the fee that he told the mortgage company about. This is not a finding that Respondent is legally entitled to the fee; it is a finding only that Respondent has a good faith basis for claiming that he is legally entitled to the fee and making that statement to the mortgage company. Therefore, the statement was not a wrongful act. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[2] Further, the standard of proof at hearing is by preponderance of the evidence.[3] 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.[4] Complainant has not met that burden. 2. The Citation and Complaint alleges violation of Arizona Revised Statutes (A.R.S.) § 32-1154(A)(7),[5] which prohibits any wrongful act that substantially harms another. Here, the wrongful act claimed by Complainant is the statement that Respondent made to the mortgage company that Respondent was owed money for consultation and preparation of the contract. 3. This tribunal has found that Respondent has a good faith basis for a claim for a consulting and preparation fee in this circumstance. This tribunal makes no finding as to whether that fee is legally owed to Respondent or in what amount. The only finding is that Respondent has a reasonable basis for claiming such a fee. This makes his statement to the mortgage company a reasonable statement and not a wrongful act. 4. Complainant has failed to show a violation of the contracting statutes by Respondent. 5. This matter should be dismissed.

. . .

RECOMMENDED ORDER Based on the foregoing, it is hereby recommended that the Citation and Complaint against Respondent Wiens Construction, Inc. in case 09-4235 be dismissed.

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 9th day of October 2009.

Office of Administrative Hearings

______________________________ Eric A. Bryant Administrative Law Judge

Copies mailed 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, Arizona Administrative Code (A.A.C.) R4-9-104 for a description of residential license classifications. [2] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [3] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [4] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996). [5] Complainant did not present any workmanship issues that would support a subsection (A)(3) violation, the other subsection cited in the Citation & Complaint.

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