ALJDEC decisions subject to certification as final

10F-0522-ROC · Registrar of Contractors · 2010-03-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: March 3, 2010 APPEARANCES: Michael Schern, Esq. represented Complainant Spire Engineering, L.L.C. Respondent The Sahuaro Group, L.L.C. failed to appear. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The question presented by this matter is whether Respondent The Sahuaro Group, L.L.C. (“Sahuaro”) is subject to discipline for acts or omissions in violation of A.R.S. § 32-1154(A). Based on the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: Procedural Background On January 4, 2010, the Registrar of Contractors (“ROC”) issued a Notice of Hearing advising the parties that the scheduled hearing in this matter would convene on March 3, 2010 at 8:00 a.m. On the date and at the time scheduled for the hearing, Michael Schern, Esq. represented Complainant Spire Engineering, L.L.C. (“Spire”). Sahuaro failed to appear or be represented. The Administrative Law Judge delayed the commencement of the hearing for approximately fifteen minutes to allow for the appearance of Sahuaro, or the receipt of any information that would constitute good cause for its absence or delay. No such information was received. Therefore, the hearing proceeded in Sahuaro’s absence. FINDINGS OF FACT Sahuaro is the holder of a Class B-01 license (No. 231590) issued by the ROC.[1] According to the filed complaint, on July 30, 2007, Sahuaro contracted with Spire for Spire to perform earthwork, site utilities, concrete, and paving at the jobsite address of 7565 East Eagle Crest Drive in Mesa, Arizona. The contract price was $202,537.00. Sahuaro has paid Spire $168,244.88 of the contract price, leaving a balance of $34,292.45.

Seth Arthur, Spire’s qualifying party and member, credibly testified at hearing that Sahuaro’s representative advised Spire that it would be paid in full, and that Sahuaro made no objections to any of Spire’s pay applications. Sahuaro had advised Spire that the reason for its non- payment was because the “bank was holding the funds.” Mr. Arthur credibly testified that Spire’s contract with Sahuaro does not contain a “pay when paid clause.” On August 5, 2009, Spire filed a complaint against Sahuaro with the ROC alleging that Sahuaro has failed to pay Spire for the services Spire performed on the construction project, in the total amount of $34,292.45. The Administrative Law Judge finds, based on the weight of the credible evidence of record, that the sum of $34,292.45 is the proper balance due and owing to Spire from Sahuaro for the work performed by Spire on the construction project. Notwithstanding repeated attempts and billings over a prolonged period of time, said balance remains unpaid. CONCLUSIONS OF LAW 1. In this proceeding, Sahuaro is subject to discipline for a violation of A.R.S. § 32-1154(A)(11) as charged by the ROC in its October 28, 2009 Citation and Complaint. See Arizona Administrative Code R2-19-119. 2. A preponderance of the evidence is “such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). 3. The Administrative Law Judge concludes that Spire met its burden of proof as to the ROC charge. 4. Under A.R.S. § 32-1154(A)(11), a contractor is subject to discipline for the “failure . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered . . .” The instant record demonstrates that Sahuaro failed to pay, when due, the sum of $34,292.45 to Spire. Accordingly, under all of the facts and circumstances presented herein, Sahuaro’s conduct is found to constitute a violation of A.R.S. § 32-1154(A)(11). 5. Based upon the above violation of the provisions of A.R.S. § 32- 1154(A), grounds exist to impose discipline against Sahuaro’s license. 6. Upon consideration of all of the facts and circumstances presented by this case, including Sahuaro’s failure to appear for hearing and its suspended license status, the Administrative Law Judge concludes that Sahuaro’s Class B-01 license should be revoked. 7. The ROC’s authority in disciplinary matters such as the one presented herein includes the ability to impose reasonable conditions that allow the disciplined contractor to reduce the scope of the disciplinary action taken against it. The Administrative Law Judge deems the exercise of such authority to be appropriate in the instant case, and preferable to imposing discipline against Sahuaro’s license without providing a condition to reduce or eliminate same. 8. The Administrative Law Judge concludes that the ROC should revoke Sahuaro’s Class B-01 license subject to the condition that Sahuaro can avoid such revocation by paying the sum of $34,292.45 to Spire. RECOMMENDED ORDER Based on the foregoing, the Administrative Law Judge makes the following Recommended Order:

It is recommended that Sahuaro’s Class B-01 license shall be revoked on the effective date of the Order entered in this matter. It is further recommended that if Sahuaro pays the sum of $34,292.45 to Spire on or before the effective date of the Order entered in this matter, then the above-provided license revocation shall not take place but instead Sahuaro’s Class B-01 license shall be placed on disciplinary probation for a period of 180 days. This alternative penalty shall commence, if at all, 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 in this matter will be forty (40) days from the date of that certification. Done this day, March 3, 2010.

/s/ Sondra J. Vanella Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] A review of the ROC’s official records revealed that Saguaro’s contracting license was suspended on October 18, 2009, for lack of bond. Such suspended license status does not preclude this tribunal from conducting these administrative proceedings. A.R.S. § 32-1154(C).

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