ALJDEC decisions subject to certification as final

2008A-45352085-ROC · Registrar of Contractors · 2013-02-04

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 15, 2013, at 8:00 a.m. APPEARANCES: Complainant Scott Householder was represented by Ernest S. Bustamante, Esq., Ernest S. Bustamante & Associates, PLLC; Respondent Boyce Landscape Management Inc. was represented by Kenneth W. Welsh, Jr., Esq., Welsh Law Group, PLC. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure On or about May 7, 1997, the Arizona Registrar of Contractors (“the Registrar”) issued License No. C-21.123138-R for residential landscaping and irrigation systems to Boyce Landscape Management Inc. (“Respondent”). The Registrar also issued License No. A-21.123139-C for commercial landscaping and irrigations systems to Boyce Landscape Management Inc. On or about May 28, 2008, Scott Householder (“Complainant”) filed a Complaint with the Registrar against Respondent, alleging twelve specific complaints about the lap pool, larger diving pool, and landscaping that Respondent constructed at Complainant’s residence at 4608 East Berneil Drive, Phoenix, Arizona. The Registrar designated Complainant’s Complaint as Case No. 08-4535. The Registrar assigned the Complaint in Case No. 08-4535 to its inspector, Eric Ulinger, for investigation. Inspector Ulinger performed a jobsite inspection and on June 24, 2008, issued a Corrective Work Order (“CWO”) in Case No. 08-4535 that required Respondent to correct certain deficiencies within fifteen calendar days, in relevant part as follows: 1. Contractor hired sub-contractors to perform work that he is not properly licensed to perform himself. It is this inspector[’]s opinion that [Respondent] is in violation of Arizona Revised Statute 32-1154.A.17[.]

2. Contractor obtained no plans or specs for the lap pool. Plans and specs are typically required by the local building official when applying for a building permit and may vary in requirements depending on the municipality.

3. Building permit was not obtained for the lap pool. The permit present at the jobsite does not appear to include the lap pool. Failure to obtain proper permits for all necessary work prior to onset of project is in violation of 32-1154.A.2[.]

4. Contractor performed work without obtaining Draining and Grading plans. Drainage plans were present at the jobsite and later provided to this inspector by the homeowner. No action required of the contractor.

5. Digging hole for lap pool caused concrete columns to move. 6. Concrete columns cracking and separating. After reviewing the Structural Engineer[’]s report provided by the homeowner it is this inspector[’]s opinion that corrective work is recommended. This contractor is not properly licensed to perform work relating to these items.

7. Concrete planters and concrete slab damage. 11. Cracking of shell in diving pool. Per homeowner these items are in regards to abandonment of the pool construction. This contractor is not properly licensed to perform or sub- contract work relating to items 5, 6, 7 & 11. Therefore the contractor is limited to paying a properly licensed contractor that is hired by the homeowner or providing financial restitution to the homeowner. (The contractor is however to complete the landscape portion of the contract provided his license is in good standing at the time the work is performed or sub-contracted.)

Per the homeowner the following items are not an issue at this time. 8. Damage to the driveway. 9. Debris not removed[.] 10. Missing protective barrier.

12. Contractor did not pay sub-contractor. This inspector is unable to verify this item.

The Registrar issued a Citation and Complaint in Case No. 08-4535 against Respondent, charging possible violations of A.R.S. § 32-1154(A)(2), former A.R.S. § 32-1154(A)(7), A.R.S. § 32-1154(A)(11), A.R.S. § 32-1154(A)(15), A.R.S. § 32-1154(A)(17), A.R.S. § 32-1154(A)(23), A.R.S. § 32-1154(A)(3), namely A.A.C. R4-9-108, and A.R.S. § 32-1154(A)(13), namely A.R.S. §§ 32- 1124(B). After Respondent failed to file a timely written answer to the Citation and Complaint, the Registrar issued a Default Decision and Order in Case No. 08- 4535 that provided that Respondent’s License No. C-21.123138-R would be revoked unless it provided the Registrar with written proof that it had performed corrective actions to resolve the items in the Complaint and the CWO. Respondent requested a rehearing and the Registrar denied the request. Respondent appealed the Default Decision and Order to superior court. On October 9, 2012, the Registrar redesigned Case No. 08-4535 as Case No. 2008- 45352085 and issued an Appeal Order that provided in relevant part as follows: Pursuant to Judge McClennen’s December 21, 2011 Ruling and Remand issued in Maricopa County Superior Court Case No. LC2009- 000911-001 DT, a copy of which is attached hereto, IT IS ORDERED that the Registrar’s May 28, 2009 Default Decision and Order and the October 30, 2009 Order Denying Request for Rehearing are vacated and Respondent shall be allowed 15 days from the date of this Order, no later than October 24, 2012, to file a timely written Answer to the January 2, 2009 Citation and Complaint, a copy of which is attached hereto. If a timely written Answer is received, the matter will be set for an administrative hearing in the expedited course of docketing. If no timely Answer is filed, a Default Decision and Order shall be issued providing for the immediate revocation of Respondent’s License, and Complainant may proceed with filing a claim with the Residential Contractors’ Recovery Fund. If found eligible, Complainant may obtain a payout from the Recovery Fund for his actual damages.

Note: A review of the Registrar’s Licensing records reveal that License No. C-21.123138-R is currently revoked for a failure to pay a civil penalty in Case No. 2010-8821633.

After Respondent filed a timely written answer to the Citation and Complaint on remand, the Registrar referred Case No. 2008-45352085 (former Case No. 08-4535) to the Office of Administrative Hearings, an independent state agency, for an evidentiary hearing. A hearing was held on January 15, 2013, in Case No. 2008-45352085 (former Case No. 08-4535). Inspector Ulinger testified. Complainant submitted seventeen exhibits and presented the testimony of two witnesses: (1) Complainant; and (2) Debra Davis Householder, Complainant’s wife. Respondent submitted six exhibits and presented the testimony of its qualifying party and officer, Jamin Ray Boyce. Hearing Evidence After Complainant and Mrs. Householder purchased a large house that had desert landscaping and an older pool in the backyard, they decided to substantially renovate the backyard. Complainant testified that the backyard renovation was Mrs. Householder’s project and that he did not get involved in the project until problems arose. Complainant and Mrs. Householder employed a full-time nanny for their children, Elizabeth Hickey. When the children were in school, Ms. Hickey was available to provide contractors with access to work at the house and to provide updates on the progress of contractors’ work to Mrs. Householder when she was out of town. Mrs. Householder testified that Ms. Hickey had no experience or education in construction and that Mrs. Householder did not tell contractors that Ms. Hickey was the jobsite superintendent. Mrs. Householder testified that she went to a “Street of Dreams” house near her house and loved the backyard. Mrs. Householder contacted the designer of the backyard at the “Street of Dreams” house and the designer referred her to Dave Boyden, who was Respondent’s project designer at the time. Respondent’s qualifying party and officer, Mr. Boyce, accompanied Mr. Boyden to his appointment with Mrs. Householder. Mr. Boyce subsequently took Mrs. Householder and Complainant on numerous “field trips” to see backyards that Respondent had been involved in installing so that they could get ideas for their own backyard. All of the backyards that Mr. Boyce showed Complainant and Mrs. Householder had pools. Mrs. Householder and Complainant testified that Mr. Boyce told them that Respondent had constructed the pools that he showed them. Mr. Boyce denied that he ever told Mrs. Householder or Complainant that Respondent had constructed the pools that he showed them. Instead, Mr. Boyce testified that he took Complainant and Mrs. Householder to see styles of pools so that they could hire a pool contractor to construct the style of pool that they wanted to include in their landscape project. On or about November 14, 2005, Respondent submitted Proposal #1558 in the total amount of $619,178.14.[1] The proposal included the following line items: Grading, Demo, & Clean up: 54,000.00T

Plant Materials: 5) 72” Box Trees 35,000.00T . . . .

Pools: 180,906.00T

Boulders: (300 Tons) 60,000.00T[2]

The parties agreed that $180,906.00 on Respondent’s November 14, 2005 proposal was for a lap pool and a larger diving pool. Mr. Boyce testified that Respondent’s November 14, 2005 proposal included the pools so that Mrs. Householder and Complainant would know the approximate amount of the landscape budget, including an allowance for the pools. Mr. Boyce denied that Respondent ever proposed to construct the pools. Mrs. Householder testified that Mr. Boyce told her that Respondent could perform the entire landscape project, including pool construction, and that the November 14, 2005 proposal included the cost of all work that the parties intended Respondent to perform, including the two pools. On or about November 17, 2005, Respondent prepared a Landscape Installation Agreement in the amount of $619,178.14. The Landscape Installation Agreement provided that Respondent would commence work on December 5, 2005, and expect to complete work by May 1, 2006. The Landscape Installation Agreement provided for a $294,906.00 payment to begin the work and the balance of $324,272.14 “to be billed in phases based on construction schedule . . . .”[3] Respondent’s attorney stated that the Landscape Installation Agreement excluding excavation. The Contractor Obligation Exclusions in the Landscape Installation Agreement provided in relevant part as follows: Contractor shall not be obligated to perform any work to correct damage caused by Owner or Owner’s agents or subcontractors not hired by Contractor, acts of God, drought, freezing, parasites, predators, termites or dry rot, soil slippage, earthquake, fire, wind, earthquake [sic], flood, erosion, failure of irrigation, electrical failure, abnormal weather, vandalism as well as any act, event or occurrence beyond the reasonable control of Contractor. Contractor shall not be obligated to perform any work to correct damage to underground utilities, water lines, sewer lines, and septic tanks, and Owner assumes the responsibility for the location of all such items. Contractor shall not be responsible for sinking ground areas; Owner shall be responsible to insure proper soil compaction. Contractor shall not be responsible for drainage or grading (unless the grading is specifically to be provided by Contractor as listed in the work above). Contractor shall not be responsible for ruts or damage to grass or other improved areas reasonably caused by heavy equipment needed to do the work.[4]

The Landscape Installation Agreement did not include a scope of work, an itemized list of costs, or the word, “pool.” Mrs. Householder signed the Landscape Installation Agreement. The November 14, 2005 proposal did not include Respondent’s license number preceded by the acronym “ROC.” The Landscape Installation Agreement included Respondent’s license number, but the number was not preceded by the acronym “ROC.” The contractor’s name on Respondent’s November 14, 2005 proposal was “Boyce Landscape, Inc.,” rather than the name on Respondent’s License No. C- 21.123138-R. Mrs. Householder testified that she understood that the Landscape Installation Agreement included the same scope of work that was set forth on Respondent’s November 14, 2005 proposal in the same amount. Mrs. Householder testified that Mr. Boyce discussed with her everything involved in the construction of the two pools, including choice of tile and decking, and that she understood that Respondent would construct or subcontract to others construction of the two pools. Mr. Boyce testified that he understood that Mrs. Householder would act as the general contractor on the project and that she would hire all subcontractors. Mr. Boyce testified that he referred Mrs. Householder to Pools Unlimited Inc., License No. B-5.111753-R for residential general swimming pool contracting (“Pools Unlimited”).[5] Respondent submitted the Preliminary Lien Notice that it filed on December 19, 2005, in the amount of $619,178.14.[6] The form showed Complainant and Mrs. Householder as the customer and “N/A” for the general contractor. Respondent submitted Pools Unlimited’s estimate dated October 30, 2005, in the total amount of $91,231.00 to build a 78,000-gallon pool and spa for “Boyce Landscaping (Householder).”[7] Although the signature line on the proposal was for Respondent, Pools Unlimited’s October 30, 2005 proposal showed Mrs. Householder’s signature. Mrs. Householder testified that on October 30, 2005, she had never heard of Pools Unlimited and denied that she ever signed its October 30, 2005 proposal. Complainant and Mrs. Householder both testified that the only way Mrs. Householder’s signature could have been placed on Pools Unlimited’s October 30, 2005 proposal was through a cut-and-paste forgery. Inspector Ulinger testified that in his opinion, $91,231.00 would not be sufficient for most pool contractors to construct a large diving pool and a lap pool. Mrs. Householder paid Respondent $294,906.00 to begin the project. Complainant testified that trucks showing Respondent’s logo brought workmen to the project to demolish the existing pool. Mr. Boyce testified that someone connected with Pools Unlimited demolished the existing pool. On or about January 3, 2006, Respondent submitted a proposal to increase the cost of the project by $11,053.35 because it had encountered a hard dig.[8] Mrs. Householder signed the proposal and issued a check to Respondent in the amount requested. Mrs. Householder testified that she did not write a separate check to demolish the old pool because it was part of Respondent’s original scope of work. Mr. Boyce testified that the January 3, 2006 invoice was based on a number that Pools Unlimited had provided. Mr. Boyce testified that Respondent did not pull the permit for the pools or supervise Pools Unlimited’s work. Mrs. Householder testified that Pools Unlimited’s owner, Joady Davis, referred her to Mr. Boyce when she attempted to ask Mr. Davis questions about the pool tile and coping that would be installed in the pools and that Mr. Davis told her that he could not discuss the project with her. Complainant submitted e-mails from Respondent’s office manager, Connie Fenton, informing Complainant and Mrs. Householder that the steel had been completed and that the pool was scheduled for inspection.[9] Mr. Boyce testified that Ms. Fenton was just providing an update to Complainant and Mrs. Householder based on information that Pools Unlimited had provided. Respondent did not submit any e-mails or other documents that expressly stated that it did not undertake to construct and was not responsible for the pools. Mrs. Householder testified that the two pools were constructed at the same time and that by May 2006, shotcrete was applied to the pools, but landscaping work had not even begun. Mrs. Householder testified that her backyard was a mess, full of piles of dirt and caliche from the excavations and grading. Mrs. Householder testified that she understood that Pools Unlimited was Respondent’s subcontractor. Mrs. Householder testified that at some point, she complained to Mr. Boyce that Mr. Davis “reeked” of alcohol when he was at the jobsite, that Pools Unlimited had only one employee installing rebar in the large pool, and that the one employee was drinking beer while he performed his work. Mr. Boyce testified that the project was delayed because Mrs. Householder kept changing her mind about what she wanted. Mr. Boyce denied that Respondent hired Pools Unlimited, but stated that he brought Pools Unlimited into the project as a referral and that it was up to Mrs. Householder whether or not to hire Pools Unlimited. The parties agreed that at some point, Pools Unlimited no longer worked on Complainant and Mrs. Householder’s pools. Mr. Boyce testified that Mrs. Householder terminated Pools Unlimited from the project. Complainant submitted Mr. Boyce’s July 6, 2006 e-mail that stated that he was only able to get one person to submit a bid to finish the pool and that he would get the final numbers on the cost to complete the pools to Mrs. Householder and Ms. Hickey as soon as he could.[10] Complainant and Mrs. Householder eventually paid Respondent $379,253.00, including the costs of the boulders and the box trees. Mrs. Householder testified that she never paid or asked Respondent to pay Pools Unlimited anything for its work on the project. Mr. Boyce testified that he reluctantly wrote second-party checks to Pools Unlimited at the request of Complainant and Mrs. Householder. Mr. Boyce testified that he did not remember how many checks he wrote to Pools Unlimited or in what amounts. On July 28, 2006, Mr. Boyce sent an e-mail to Mrs. Householder, assuring her that “[t]he number that we have provided you are actual costs that have been applied to the project” and that the trees had to be ordered and paid for because the large size was not commonly available on the Phoenix market.[11] Mr. Boyce stated in the e-mail that he had been waiting weeks to proceed forward. Mrs. Householder testified that Mr. Boyce sent the e-mail to her after a meeting between the two of them at Einstein’s Bagels, at which she had asked him for receipts for the project. Mrs. Householder testified that after Mr. Boyce told her that Respondent still had $39,000.00 from her payments, she asked him to write a check in that amount “as a gesture of good faith.” Mr. Boyce testified that Respondent used the monies that Mrs. Householder paid to purchase the large trees and boulders for the project. Complainant testified that after progress was no longer being made on the project, he became involved. By the fall of 2006, Complainant and Mrs. Householder’s patio and the columns were showing signs of damage due to the proximity of the lap pool to the house. Complainant testified that he hired Salem Consulting Group (“Salem”) to inspect the structural damage to his house and that Salem hired a structural engineer to prepare a report on the damage. On November 10, 2006, Ms. Fenton on behalf of Respondent sent an e-mail to Complainant, informing him that she was putting together a spreadsheet and that the demolition of the lap pool would begin on November 13, 2006, that the boulders would be delivered and installed within the two weeks of the lap pool’s demolition, and that Respondent would then perform grading and install walls for the landscaping.[12] Respondent did not deliver any trees or boulders to the project. Respondent did not submit any invoices or purchase orders to substantiate the sums that it claimed that it had spent on the project. Complainant testified that he hired attorney John Buric to help him force Respondent to complete the project. Complainant testified that although Mr. Buric advised him to file a complaint with the Registrar against Respondent, because Complainant just wanted Respondent to return his money or complete the project, he terminated Mr. Buric’s representation in January 2008.[13] Complainant testified that he paid Salem $17,000.00 to perform repairs to keep his house from falling down. Complainant testified that Respondent’s work caused $100,000.00 in damage to his house. Mr. Boyce testified that Respondent paid the consulting company $17,000.00 to fill in the lap pool. Respondent blamed Pools Unlimited for the deficiencies noted on the CWO. When Complainant was asked whether he had filed complaints with the Registrar against Pools Unlimited, he testified that if such complaints were filed, Mr. Buric or Salem filed them on his behalf. Respondent did not submit any documentation to establish the content or the outcome of those alleged complaints against Pools Unlimited. On or about May 14, 2008, Respondent submitted a proposal to Complainant and Mrs. Householder to perform work to finish their backyard project, including pool coping and retaining walls in the pool area, in the total amount of $302,938.64.[14] Inspector Ulinger testified that when he performed the jobsite inspection, one pool was in the gunite stage and the lap pool had already been filled in. Inspector Ulinger testified that no landscape work had been performed. Inspector Ulinger testified that according to his notes, at the jobsite inspection, Mr. Boyce stated that Respondent’s contract included construction of the pools. Mr. Boyce denied that he ever told Inspector Ulinger that Respondent contracted to construct the pools. Inspector Ulinger testified that his notes did not reflect who hired Pools Unlimited or who paid for its work on the project. Inspector Ulinger testified that at the jobsite inspection, Mr. Boyce showed him a permit for the diving pool, but that he did not remember whether the permit included the lap pool. Inspector Ulinger testified that Mr. Boyce did not provide plans for the lap pool. Inspector Ulinger testified that a general contractor on a project is responsible for ascertaining whether a permit is required. Respondent submitted a permit dated February 17, 2006, for a lap pool, diving pool, and spa at Complainant’s property that showed Pools Unlimited as the contractor on the project. Inspector Ulinger testified that he had never investigated Pools Unlimited’s role in the project, but that the permit appeared to cover the project. Inspector Ulinger testified that if a permit had been issued, the local building authority must have had plans for both pools. Inspector Ulinger testified that if the lap pool was excavated between October and December 2005, the February 17, 2006 permit would not cover the excavation because permits do not apply to past events. Inspector Ulinger testified that anyone can pull a permit, but that the permit must show the name of the licensed entity that will perform the work. Inspector Ulinger testified that he saw damage to the columns and patio that was consistent with digging a pool and that after he reviewed the structural engineer’s report that Complainant provided, he determined that digging the lap pool had damaged the columns and slab on the patio (CWO Item Nos. 5, 6, and 7). Inspector Ulinger testified that at his jobsite inspection, the diving pool had shotcrete in it and that the shotcrete had cracks in that were consistent with shotcrete that has been installed in a pool for more than a week or two. Mr. Boyce acknowledged that Respondent did not comply with the CWO. Complainant testified that in 2010, he paid other contractors to complete the backyard project. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website on February 4, 2013. Such prior License record reflects that Respondent’s License No. C-21.123138-R was still revoked. The Registrar’s public website reflects that Boyce Landscape Management Inc.’s License No. A-21.123139-C is current. CONCLUSIONS OF LAW The revoked status of Respondent’s license does not deprive Complainant of his right to prosecute his Complaint against Respondent or prevent the Registrar from determining the merits of Complainant’s complaint.[15] This matter lies within the Registrar’s jurisdiction.[16] Complainant bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence.[17] Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.[18] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[19] Under A.A.C. R4-9-103(B), the scope of Respondent’s residential C-21 Landscaping and Irrigation Systems license was limited to the following: Preparation and alteration of land for horticulture and arboriculture. Installation of irrigation systems and controls. Carpentry is limited to decorative fences and screens, planter boxes, and plant tubs common to the industry. Excluded are retaining walls over 3 feet, decorative walls or fences over 6 feet, perimeter walls, fences, and load bearing slabs and walkways.

If necessary, a new circuit may be added to the existing service panel or sub-panel. Excluded is the installation of a new service panel or sub-panel. This scope includes all C-21R subclassifications. C21R Landscaping C21R Irrigation Systems License classifications A-9 and B-5 do not allow demolition of a pool, construction of a pool, or construction of retaining walls that are over three feet. “‘Knowingly’ imports only a knowledge that the facts exist which bring the act or omission within the provisions of the statute using such word. It does not require any knowledge of the unlawfulness of the act or omission.”[20] “‘Notice of facts and circumstances which would put a man of ordinary prudence and intelligence on inquiry is . . . equivalent to knowledge of all the facts a reasonably diligent inquiry would disclose.’”[21] Complainant established that Respondent contracted to demolish the existing pool and to construct the lap pool and diving pool and that Respondent subcontracted at least a portion of this work to Pools Unlimited. Because Respondent should have known that its C-21 license did not allow it to perform or to subcontract to others demolition and construction of the pools,[22] Complainant established that Respondent violated A.R.S. § 32- 1154(A)(17).[23] Complainant established that Respondent demolished the old pool and performed the excavation for the two new pools before it obtained a permit for the work. Complainant also established that a permit was required for both pools and that an engineering plan was required for the lap pool. Therefore, Complainant established that Respondent violated A.R.S. § 32- 1154(A)(2).[24] Complainant established that Respondent’s excavation for the lap pool damaged the concrete columns at Complainant’s house, causing them to crack and separate, and damaged the concrete planters and patio slab. Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(3), namely A.A.C. R-4-108,[25] and former A.R.S. § 32-1154(A)(7).[26] Respondent failed to comply with the June 24, 2008 CWO and did not establish any legal justification for its failure. Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(23).[27] The name, Boyce Landscape, Inc., rather than the name on Respondent’s License No. C-21.123138-R was on Respondent’s November 14, 2005 proposal. Therefore, Respondent violated A.R.S. § 32-1154(A)(15).[28] Respondent did not include its license number preceded by the acronym “ROC” on the November 14, 2005 proposal and the acronym “ROC” did not precede the license number on the Landscape Installation Agreement. Therefore, Respondent violated A.R.S. § 32-1154(A)(13), namely A.R.S. § 32- 1124(B).[29] Complainant established that Respondent failed to account for all the monies that Mrs. Householder paid to Respondent for the project. However, Complainant did not establish that Respondent failed to pay any monies to any subcontractor or supplier for materials or services rendered in connection with Complainant and Mrs. Householder’s project. Therefore, Complainant did not establish that Respondent violated A.R.S. § 32- 1154(A)(11).[30] Complainant requested that the Registrar discipline License No. A- 21.123139-C. The Registrar only cited Respondent’s residential License No. C-21.123138-R in this matter. Although discipline against License No. C- 21.123138-R eventually may lead to discipline against License No. A- 21.123139-C under A.R.S. § 32-1154(A)(21),[31] that violation was not charged and License No. A-21.123139-C is not at issue in this matter. RECOMMENDED ORDER As a result of the contracting law violations that Complainant Scott Householder established in his Complaint in Case No. 2008-45352085 (former Case No. 08-4535), it is recommended that on the effective date of the Registrar’s final Order, Respondent Boyce Landscape Management Inc.’s License No. C-21.123138-R shall be revoked. It is further recommended that the Registrar require Respondent to pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(D).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s Order, the Registrar revoke Respondent’s license, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty. 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, February 4, 2013.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See Complainant’s Exhibit 2. [2] Complainant’s Exhibit 2. [3] Complainant’s Exhibit 3 at 1. [4] Complainant’s Exhibit 3 at 2. [5] According to the Registrar’s public website, Pools Unlimited License No. B-5.111753 was revoked on January 22, 2008. [6] See Respondent’s Exhibit C. [7] See Respondent’s Exhibit A. [8] See Complainant’s Exhibit 9. [9] See Complainant’s Exhibit 10. [10] See Complainant’s Exhibit 11. [11] Complainant’s Exhibit 12. [12] See Complainant’s Exhibit 15. [13] See Complainant’s Exhibit 17. [14] See Complainant’s Exhibit 16. [15] See A.R.S. § 32-1154(C). That statute provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such license, or to render a decision suspending or revoking such a license . . . .” [16] See A.R.S. §§ 32-1151 to 32-1169. [17] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [18] See A.A.C. R2-19-119(B)(2). [19] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [20] A.R.S. § 1-215. [21] Maricopa Utilities Co. v. Cline, 60 Ariz. 209, 214, 134 P.2d 156 (1943) (quoting Schneider v. Henley, 61 Cal. App. 758, 763, 215 P. 1036, 1038 (1923)). [22] “Contractor” is defined as anyone who “does himself or by or through others” performs construction. A.R.S. § 32-1101(A)(3) (emphasis added). [23] This statutory subsection includes among the grounds for suspension, revocation, and other disciplinary action against a contractor’s license “[k]nowingly contracting beyond the scope of the license or licenses of the licensee.” [24] A.R.S. § 32-1154(A)(2) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[d]eparture from or disregard of plans or specifications or any building codes of any state or any political subdivision of the state in any material respect which is prejudicial to another without consent of the owner or the owner’s duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code.” [25] A.R.S. § 32-1154(A)(3) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[v]iolation of any rule adopted by the registrar.” A.A.C. R4-9-108 requires that “[a]ll work shall be performed in a professional and workmanlike manner” and that “[a]ll work shall be performed in accordance with any applicable building codes and professional industry standards.” [26] A.R.S. § 32-1154(A)(7) formerly included among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[t]he doing of a wrongful or fraudulent act by the licensee as a contractor resulting in another person being substantially injured.” Although section A.R.S. § 32-1154(A)(7) was amended in 2009, the former section applies to Complainant’s Complaint. [27] A.R.S. § 32-1154(A)(23) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar.” [28] A.R.S. § 32-1154(A)(15) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]cting in the capacity of a contractor under any license issued under this chapter in a name other than as set forth upon the license.” [29] A.R.S. § 32-1154(A)(13) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” A.R.S. § 32-1124(B) requires that licensed contractors include their license number “preceded by the acronym ‘ROC’“ on “all written bids submitted by the licensee and . . . on all advertising, loan forms, lending institution forms, letterheads and other documents used by the licensee in the conduct of business regulated by this chapter.” [30] A.R.S. § 32-1154(A)(11) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure by a licensee . . . to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee’s operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.” [31] A.R.S. § 32-1154(A)(21) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[h]aving a person named on the license who is named on any other license in this state or in another state which is under suspension or revocation unless the prior revocation was based solely on a violation of this paragraph.”

-----------------------

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