ALJDEC decisions subject to certification as final

10F-1242-ROC · Registrar of Contractors · 2010-04-13

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: April 12, 2010 at 1:00 p.m. APPEARANCES: The Complainant appeared on his own behalf. The Respondent appeared through its authorized representative, Shannon Meyers. ADMINISTRATIVE LAW JUDGE: M. Douglas

Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT

1. The Respondent is the holder of a Class C-02 License issued by the Registrar of Contractors. 2. Credible testimony and evidence established that the Complainant’s contractor’s license was voluntarily canceled by the Complainant in February, 2007. 3. There was no dispute that the parties had entered into an oral agreement while the Complainant was a licensed contractor wherein the Complainant would assess construction projects and perform bid work as a subcontractor for the Respondent. 4. Credible testimony and evidence established that the Complainant would receive ten percent of the total project cost if the estimate and bid submitted by the Complainant was accepted by the customer. 5. Credible testimony, presented at hearing, established that the Respondent would customarily give the customer the option of having work performed pursuant to the bid or choosing to have construction work performed on a time and material basis and that the Respondent would then be paid on an hourly basis. 6. Credible testimony established that if the customer elected to have the work performed on a time and material basis rather than accept the bid and estimate prepared by the Complainant, then the Complainant would not be paid a percentage of the Respondent’s hourly wage and that the Complainant would then only be paid for any construction work that the Complainant actually performed at the construction project. 7. Credible testimony and evidence established that the Complainant continued to work as a subcontractor for the Respondent after the Complainant’s contractor’s license was canceled in February, 2007. 8. The Complainant alleged that the Respondent owes the Complainant a total of $13,150.00 for the bid and estimate work performed by the Complainant for three separate construction projects. 9. The Complainant alleged that the Respondent had failed to pay the Complainant $650.00 due to the Complainant for the Complainant’s work on the Shadow Ridge construction project. 10. The Complainant testified that he was a properly licensed contractor during the time period for the Shadow Ridge construction project. 11. ‘The Complainant alleged that the Respondent had failed to pay the Complainant $9,800.00 for his construction work on the Lot 7, Parcel K construction project. 12. The Complainant testified that he was a licensed contractor for a portion of the bid and estimate work performed on the Lot 7, Parcel K project. 13. The Complainant alleged that the Respondent had failed to pay the Complainant $2,700.00 for his construction work on the Lot 7, Parcel K Addition project. 14. The Complainant admitted that it was not a licensed contractor for any of the work performed on the Lot 7, Parcel K Addition construction project. 15. Credible testimony and evidence established that the Complainant was a licensed contractor during the Shadow Ridge construction project. 16. Credible testimony and evidence established that the Complainant was not a licensed contractor during the Lot 7 Parcel K and Lot 7 Parcel K addition construction projects. 17. The Respondent asserted that it was unaware that the Complainant had voluntarily canceled his contractor’s license in February, 2007. 18. The Respondent asserted that the Respondent had continued working with the Complainant based upon the Respondent’s assumption that the Complainant was a properly licensed contractor since the Complainant had been a licensed contractor when the parties started working together. 19. The Respondent admitted that it performed no checks on the status of the Complainant’s contractor’s license during 2007 and 2008. 20. The Respondent asserted that the Complainant was owed no money for the Complainant’s work on the Shadow Ridge construction project based on the Respondent’s allegations that the Complainant had received cash advances for gas expenses and living expenses that exceeded any money that would have been due to the Complainant pursuant to the parties’ oral construction agreement. 21. The Respondent alleged that the Complainant was due no money for the Lot 7 Parcel K and the Lot 7 Parcel K addition construction projects on the basis that both construction projects were cost plus contracts wherein the Respondent was paid on an hourly basis for construction work performed for the two construction projects. 22. There was no dispute that the Respondent had advanced the Complainant $405.00 for gas expenses during the Shadow Ridge construction project leaving a balance of $245.00 owed to the Complainant for the Shadow Ridge Construction Project. 23. There was no credible evidence of any living expenses that may have been advanced to the Complainant other than gas expenses during the Shadow Ridge Construction project. 24. Credible testimony and evidence, presented at hearing, established that the customer had rejected the bids and estimates for the Lot 7 Parcel K and Lot 7 Parcel K addition construction projects and that both construction projects were cost plus construction projects rather than bid construction projects and that no money is due to the Complainant for these two construction projects under the terms of the parties’ oral construction agreements. 25. Credible testimony and evidence established that the Complainant did perform estimate and bid work for the Respondent for the Lot 7 Parcel K and Lot 7 Parcel K addition construction projects and that the Complainant was not a licensed contractor when he performed estimate and bid work for the Respondent. 26. Credible testimony and evidence established that a contractor’s license is required for such bid and estimate work unless the Complainant was an employee of the Respondent. 27. There was no dispute that the Complainant was not an employee of the Respondent. 28. Credible testimony established that the Respondent either knew or should have known that the Complainant was not a licensed contractor during the Lot 7 Parcel K and Lot 7 Parcel K addition construction projects and that the Respondent aided an abetted an unlicensed person to evade the state’s contracting laws for the two construction projections. 29. There was no credible evidence of a violation of the charged provisions of A.R.S. § 32-1154A (13), namely A.R.S. § 32-1124(B). 30. The $650.00 claimed as due and owing, and the $245.00 found to be due to the Complainant, for the Shadow Ridge construction project is less than the statutory amount required to constitute a violation of the charged provisions of A.R.S. § 32-1154A(11). 31. Notice is taken of the Respondent’s prior good License record with the Registrar of Contractors.

CONCLUSIONS OF LAW

1. The credible evidence of record established violations by the Respondent of the provisions of A.R.S. § 32-1154A(10) (Aiding and abetting an unlicensed person to evade the provisions of this chapter).

RECOMMENDed Order

In view of the foregoing, it is recommended that on the effective date of the Registrar’s Order that the Respondent’s Class C-02 License shall be revoked unless the Registrar of Contractors receives and accepts written proof that the Respondent has paid the Complainant the sum of $245.00 due to the Complainant pursuant to the parties’ oral agreement for the Shadow Ridge construction project. It is further recommended that if the Respondent pays the above described sum of money to the Complainant, on or before the effective date of this Order, then the above provided license revocation shall not take place and that instead the Respondent’s Class C-02 License shall be actively suspended for a period of ten days. In the event of certification of this 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 the certification.

Done this day, April 13, 2010.

/s/ M. Douglas 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