ALJDEC decisions subject to certification as final

2010A-22607977-ROC-com · Registrar of Contractors · 2013-02-05

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

COMPLIANCE HEARING: January 17, 2013, at 1:00 p.m. APPEARANCES: Complainant Sun Tech Coating Manufacturing appeared through Gene Cox, its owner; Respondent M and T Roofing LLC did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT The Arizona Registrar of Contractors (“the Registrar”) issued License No. K- 5.243606-D to M and T Roofing LLC (“Respondent”). Respondent’s current address of record is 1622 West Linden Street, Phoenix, Arizona 85007-2033. Sun Tech Coating Manufacturing (“Complainant”) manufactures roofing supplies and systems for sale to contractors such as Respondent. Complainant filed a Complaint with the Registrar that alleged that Respondent owed Complainant $56,173.65 for materials purchased for various roofing jobs. After Respondent failed to pay Complainant anything, the Registrar issued a Citation and Complaint charging Respondent with a possible violation of A.R.S. § 32-1154(A)(11). Respondent failed to file a timely written answer to the Citation and Complaint. The Registrar’s Order Setting Compliance Hearing provided the following summary of events after Respondent’s failure: / / / / On November 24, 2010, the Registrar issued a Default Decision and Order in this matter providing that Respondent’s K- 5.243606-D License would be suspended on the effective date of the Order and remain suspended until the Registrar received written proof that Respondent had paid Complainant the amount of $56,173.65. If the Registrar received and accepted such written proof, then Respondent’s K-5.243606-D License would not be suspended. The Order had an effective date of January 3, 2011.

On May 18, 2011, the Registrar suspended Respondent’s K- 5.243606-D License in accordance with the terms of the November 24, 2010 Default Decision and Order.

On or about May 25, 2011, Respondent submitted written correspondence in this matter with the Registrar maintaining, among other things, that “this matter was resolved by the court in November or December with a cashier’s check.” The Registrar treated this submission as a Notice of Compliance.

On June 17, 2011, the Registrar sent a copy of Respondent’s Notice of Compliance to Complainant providing Complainant with an opportunity to file a Response thereto.

On or about June 21, 2011, Complainant submitted written correspondence in this matter with the Registrar providing, among other things, that the matter has not been resolved and that Respondent has not made any effort to resolve the past due accounts.

Upon review and consideration, and with good cause appearing, IT IS ORDERED that a Compliance Hearing be scheduled in the expedited course of docketing in the Phoenix area. At the Compliance Hearing, the parties may offer evidence and testimony as to whether or not Respondent has fully complied with the terms of the Registrar’s November 24, 2010 Default Decision and Order.

If it is determined that Respondent failed to comply with the Registrar’s November 24, 2010 Default Decision and Order, Respondent’s K-5.243606-D License shall remain suspended. If it is determined that Respondent has fully complied with the terms of the November 24, 2010 Default Decision and Order then the suspension imposed against Respondent’s K-5.243606-D License shall be lifted and this matter closed.

Note: Respondent’s K-5.243606-D License was revoked on May 18, 2011 in Case No. 2010-26659048 for a failure to comply with the terms of the Registrar’s Order issued in that case. It was again revoked on October 27, 2011, November 10, 2011, and February 24, 2012 in Case Nos. 2010-[number redacted], 2011-1803 and 2010-[number redacted], respectively, for a failure to comply with the Registrar’s Orders issued in these matters. Lastly, Respondent’s K-5.243606-D License was revoked for failure to pay a civil penalty in Case No. 2010-[number redacted] on March 28, 2012. Thus, the Registrar maintains that keeping the suspension in effect during the pendency of the compliance determination will not prejudice Respondent.

The Registrar referred the matter to the Office of Administrative Hearings (“the OAH”), an independent agency, for an evidentiary hearing on the issue of whether Respondent had complied with the Registrar’s Default Decision and Order. The Registrar issued a Notice of Compliance Hearing, setting a compliance hearing on January 17, 2013, at 1:00 p.m. The Registrar sent a copy of the Notice of Compliance Hearing to Respondent at its address of record. A compliance hearing was held on January 17, 2013, at 1:00 p.m. Although the beginning of the duly noticed compliance hearing was delayed fifteen minutes to allow Respondent additional travel time, it did not appear through an authorized member, employee, or attorney, did not contact the OAH to request that the time for the compliance hearing be further delayed, and did not request to appear telephonically. Respondent did not present any evidence at the compliance hearing to establish that it complied with the Registrar’s Default Decision and Order. Complainant presented the testimony of Gene Cox, its owner. Mr. Cox testified that although the parties had agreed that Respondent would pay Complainant $250.00/month to resolve Complainant’s Complaint, Respondent had only made two payments in the total amount of $500.00. Mr. Cox testified that Complainant had obtained a judgment against Respondent in justice court and that as a result, Respondent was forced to submit to a debtor’s examination. Mr. Cox testified that although Respondent did not bring all its financials to the debtor’s examination, Respondent’s bank records indicated that it earned approximately $80,000.00 in four months. Mr. Cox testified that Respondent’s owners, Mark and Thomas Passerrelli, do good work but that most of their money goes to the casino. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar’s public website on February 5, 2012. Such prior License record reflects that the revocations that the Registrar noted on the Order Setting Compliance Hearing and that Respondent’s License No. K- 5.243606-D remained revoked. CONCLUSIONS OF LAW 1. This matter lies within the Registrar’s jurisdiction.[1] 2. The Notice of Compliance Hearing that the Registrar mailed to Respondent at its address of record was reasonable and Respondent is deemed to have received notice of the compliance hearing.[2] 3. Respondent bears the burden of proof to establish that it complied with the Registrar’s Default Decision and Order.[3] By failing to appear at the compliance hearing, Respondent failed to sustain its burden to establish compliance. 4. Mr. Cox established that Respondent still owes Complainant $55,673.65 for materials that Respondent used in its contracting business, in violation of A.R.S. § 32-1154(A)(11).[4] RECOMMENDED ORDER Based on the foregoing, it is recommended that the Registrar immediately revoke Respondent M and T Roofing LLC’s License No. K-5.243606- D. 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 five days from the date of that certification. Done this day, February 5, 2013.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See A.R.S. §§ 32-1151 to 32-1169. [2] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [3] See A.A.C. R2-19-119(B)(1). [4] 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.”

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