ALJDEC decisions subject to certification as final

10F-0260-ROC · Registrar of Contractors · 2010-03-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 10, 2010 APPEARANCES: Stephen Gilman appeared personally. Accurate Developments, L.L.C. was represented by its attorney, Michael Schern, 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. On July 21, 2009, Stephen Gilman (“Complainant”) filed a written Complaint with the Registrar against Precision Developments, Inc. (“Precision”) concerning the construction of his home located at 7251 N. 89th Drive, Glendale, Arizona. 2. Complainant’s Complaint alleged the following workmanship deficiencies by Precision: #1. Effervescing paint all around the house. #2. Stucco cripping [sic], chipped all around the house. #3. Broken city walk a trip hazard. #4. Seal bathtub in master br.

3. The Registrar designated Complainant’s Complaint against Precision as Case No. 10-0260. 4. Precision is the holder of License No. 098266, a Class B- contracting license issued by the Registrar. 5. Robert Henry Nuttall is listed as Precision’s corporate officer and qualifying party. Melanie Dee Nuttall is listed as Precision’s corporate secretary. 6. On March 26, 2009, Precision’s License No. 098266 was cancelled. Notwithstanding the cancellation of Precision’s contracting license, the Registrar still has jurisdiction over that license. 7. On May 21, 2009, Precision filed a Chapter 13 bankruptcy petition, which was designated as 2:09-BK-11115-CGC. As a result of the filing of the bankruptcy petition, an automatic stay went into effect. 8. On June 3, 2009, Precision’s Chapter 13 bankruptcy action was converted to a Chapter 7 liquidation bankruptcy action. 9. In response to the filed Complaint, the Registrar’s assigned inspector, Rick Oelke, performed a jobsite inspection at Complainant’s residence on August 7, 2009, to view the Complaint items. That jobsite inspection resulted in Inspector Oelke issuing Precision a Corrective Work Order dated August 26, 2009, which required Precision to timely perform specified remedial work as outlined in the written directive. 10. On October 2, 2009, Inspector Oelke reissued the Corrective Work Order issued in Case No. 10-0260 to Accurate Developments, L.L.C. (“Respondent”), which required Respondent to perform the identical remedial work as required by the Corrective Work Order dated August 26, 2009, issued to Precision. 11. Respondent is the holder of License No. 253261, a Class KB-01 contracting license issued by the Registrar. Respondent’s license was issued on March 1, 2009. Robert Henry Nuttall is listed as Respondent’s member and qualifying party. Brandi Lee Nuttall is also listed as Respondent’s member. 12. Inspector Oelke testified that the Registrar’s management made the decision to substitute Respondent in place of Precision in Complaint No. 10-0260 because Mr. Nuttall appears on both licenses and both legal entities have the same business location. 13. On November 20, 2009, the Registrar issued a Citation and Complaint in Case No. 10-0260 charging Respondent with violations of A.R.S. § 32- 1154(A) (2), (23), and (3), namely A.A.C. R4-9-108. 14. The Registrar forwarded Case No. 10-0260 to the Office of Administrative Hearings, an independent agency, for an evidentiary hearing. 15. At hearing, Brian Wilhelm testified that he is employed by New Sun Homes, the developer of Complainant’s residence, and that he had been employed by Respondent. 16. Mr. Wilhelm further testified that New Sun Homes contracted with Precision to construct homes. 17. Homeowners who purchased a New Sun Homes residence were advised to call New Sun Homes for customer service. New Sun Homes would then contact the applicable subcontractor to perform remedial work. 18. Precision served as the primary general contractor for New Sun Homes. Precision hired subcontractors. 19. Mr. Wilhelm stated that he never worked for Precision. 20. Since Precision filed for bankruptcy, it has not done any work for New Sun Homes. New Sun Homes has contacted subcontractors directly for warranty work. 21. Mr. Wilhelm further testified that Respondent did not purchase any part of Precision or agree to do any of Precision’s warranty work. 22. Complainant testified that he had no idea Precision had filed for bankruptcy. Complainant made service calls as directed to the telephone number given to him. 23. Complainant further testified that he cannot say if workers who came out to his residence in response to his warranty requests were Precision’s subcontractors or not. 24. Notwithstanding the fact that Robert Henry Nuttall appears on both licenses, Respondent and Precision are determined to be separate legal entities. 25. Respondent does not have privity of contract with Complainant. There is no credible evidence that Respondent assumed Precision’s obligation to perform warranty work or any other contractual obligation Precision has or had with Complainant. 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 bears the burden of proof in this matter. The standard of proof is preponderance of the evidence. A.A.C. R2-19-119(A). 3. Pursuant to A.R.S. § 32-1154(C), the cancellation of Precision’s contracting license does not deprive the Registrar of the authority to discipline that license for statutory and/or regulatory violations committed while that license was in effect. 4. Complainant failed to sustain his burden of proving that Respondent violated the provisions of A.R.S. § 32-1154(A) (2), (23), and (3), namely A.A.C. R4-9-108, as charged in the Citation and Complaint issued by the Registrar in Case No.10-0260. The above Findings of Fact support this conclusion. RECOMMENDED ORDER The Citation and Complaint issued in Case No. 10-0260 shall be dismissed on the effective date of the Order entered in this matter. 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, March 29, 2010.

/s/ Brian Brendan Tully Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors -----------------------

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