ALJDEC decisions subject to certification as final

2010A-22269394-ROC · Registrar of Contractors · 2010-07-07

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 7, 2010 at 8:00 a.m. APPEARANCES: Complainant Agua Fria Aggregates LLC appeared through Charles E. Cochran, authorized employee; Respondent Falcon Excavating Inc. did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT On October 10, 2004, the Arizona Registrar of Contractors (“the Registrar”) issued License No. ROC200782, Class A for general engineering to Respondent Falcon Excavating Inc., a corporation. Respondent’s address of record is P.O. Box 841432, Hildale, UT 84784-1432. Samuel Jessop is Respondent’s qualifying party and the only natural person listed on its license. Complainant Agua Fria Aggregates LLC operates a gravel pit and is in the business of providing aggregate and other construction materials to contractors like Respondent. On December 18, 2009, the Registrar received a complaint from Complainant against Respondent’s license, which alleged that Respondent owed $8,810.80 in unpaid invoices for materials that Complainant had supplied and that Respondent had used in its contracting business. Complainant attached the following invoices to Respondent for materials that it had ordered to be hauled to the Meadow Valley Asphalt Plant in Vicksburg, Arizona: |Invoice No. |Date |Amount | |7508 |April 9, 2009|$1,538.06| |7509 |April 13, |$5,760.12| | |2009 | | |7512 |April 20, |$1,512.62| | |2009 | |

The Registrar referred the complaint to Respondent for its immediate attention. On January 6, 2010, the Registrar received Complainant’s request for hearing because Respondent had not paid anything on its account. On March 18, 2010, the Registrar issued a Citation and Complaint against Respondent’s license, charging a violation of A.R.S. § 32-1154(A)(11). The Registrar mailed a copy of the Citation and Complaint to Respondent at its address of record. On March 22, 2010, the Registrar received Respondent’s written answer to the Citation and Complaint. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent agency, to schedule and to conduct a fair hearing. On May 27, 2010, the Registrar issued a Notice of Hearing setting a hearing on May 7, 2010 at 8:00 a.m. at OAH. The Registrar mailed the Notice of Hearing Respondent at its address of record. On June 25, 2010, the Registrar issued a Correction of Clerical Error, which corrected the date of the hearing to July 7, 2010. The Registrar mailed the Correction of Clerical Error to Respondent at its address of record. A hearing was held on July 7, 2010 at 8:00 a.m. Complainant’s representative appeared, testified, and submitted one exhibit at the duly noticed hearing. Although the beginning of the hearing was delayed twenty minutes to allow Respondent additional travel time, it did not contact OAH to request that the hearing be continued or that the start of hearing be further delayed and did not appear through an authorized officer, employee, or attorney. Respondent did not present any evidence to defend its license. Complainant’s representative testified that it had hauled the materials described on the invoices from the gravel pit to the Meadow Valley Asphalt Plant pursuant to Respondent’s request. Meadow Valley’s superintendent Harry Kimble told Complainant that Respondent had been paid in full for the job. Mr. Jessop promised to pay when Complainant initially had inquired about Respondent’s past due account. During the last few discussions, however, Mr. Jessop stated that he had no money. Respondent had made no payments on its account. Complainant submitted a statement and updated invoices that showed that, with interest accruing at the statutory rate of 10% per annum, as of June 20, 2010, Respondent owed Complainant $9,765.26. The Registrar’s record shows that Respondent’s license has been voluntarily cancelled. CONCLUSIONS OF LAW 1. The Notice of Hearing and Correction of Clerical Error that the Registrar mailed to Respondent at its address of record were reasonable and it is deemed to have received these documents.[1] 2. The cancelled status of Respondent’s license does not preclude Complainant from pursuing its administrative remedy nor preclude the Registrar from conducting this disciplinary proceeding.[2] 3. Complainant bears the burden of proof and must establish Respondent’s statutory violations by a preponderance of the evidence.[3] Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.[4] 4. “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[5] A preponderance of the evidence is “[t]he greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.”[6] 5. 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.” 6. A contractor’s inability to pay and nonpayment by the owner or general contractor on a project are affirmative defenses that the general contractor bears the burden to prove in a subcontractor’s administrative complaint under A.R.S. § 32- 1154(A)(11). Because Respondent did not present any evidence at the hearing, it has not borne its burden to establish these affirmative defenses. 7. Complainant has established that Respondent has failed to pay Complainant the principal amount of $8,810.80 for materials that Complainant furnished and that Respondent used in its contracting business, in violation of A.R.S. § 32-1154(A)(11). 8. With respect to the amount owed, the legislature has not empowered the Registrar to award interest[7] in administrative proceedings against a contractor’s license. Statutory interest is only available in actions on claims made in judicial forums.[8] RECOMMENDED ORDER Based on the contracting law violations that were proven in this matter, it is recommended that, on the effective date of the final order in this matter, the Registrar of Contractors revoke License No. ROC200782, Class A previously issued to Respondent Falcon Excavating Inc. unless Respondent pays the principal amount owed on its account with Complainant Agua Fria Aggregates, LLC It is further recommended that if, on or before the effective date of the order, the Registrar receives proof from Respondent that it has paid $8,810.80 to Complainant by cashier’s or certified check, then the Registrar shall not revoke Respondent’s license but, instead, close the complaint in Case No. 2010-22269394. If the Director of the Office of Administrative Hearings certifies this Administrative Law Judge Decision, the effective date of the order will be forty days from the date of certification. Done this day, July 8, 2010. /s/ Diane Mihalsky Administrative Law Judge Transmitted electronically to: William A. Mundell, Director Registrar of Contractors ----------------------- [1] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [2] See A.R.S. § 32-1154(C). [3] 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). [4] See A.A.C. R2-19-119(B)(2). [5] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [6] Black’s Law Dictionary at page 1220 (8th ed. 1999). [7] Cf. A.R.S. § 12-347 (entitling court clerk to include in judgment costs and “interest on the verdict from the time it was rendered”). [8] See Semple v. Tri-City Drywall, Inc., 172 Ariz. 608, 611-612, 838 P.2d 1369, 1372-73 (App. 1992) (Prevailing party in administrative claim before Registrar of Contractors was not entitled to attorney’s fees from its opponent under Title 12 because administrative hearing is not an “action”).

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