ALJDEC decisions subject to certification as final

2010A-308471336-ROC · Registrar of Contractors · 2010-11-18

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: November 15, 2010 at 8:00 a.m. APPEARANCES: The Complainant appeared through its authorized representative, Shannon Niemann. The Respondent appeared through authorized representative, Carl J. Schemel. 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 K-60 License (No. 214017) issued by the Registrar of Contractors. 2. The Complainant is a commercial general contacting company that specializes in restaurants, retail and office buildings and general tenant improvements. 3. Pursuant to the terms of the parties’ written construction agreement, the Respondent performed millwork on a commercial construction project wherein the Complainant was operating in the capacity of a commercial general contractor. 4. There was no dispute that the owner of the commercial business was extremely dissatisfied with the Respondent’s alleged failure to complete its work in a prompt and professional manner. 5. Credible testimony and evidence established that the owner of the residence declined to pay the remaining sum due for the Respondent’s millwork on the commercial building at issue. 6. The Complainant notified the Respondent of the owner’s dissatisfaction and the parties attempted to resolve the matter. 7. When the parties were unable to resolve the matter to the business owner’s satisfaction, the Complainant filed a formal Complaint against the Respondent with the Registrar of Contractors. 8. Pursuant to the filing of the formal Complaint, an assigned Agency Inspector conducted an on-site inspection and on April 19, 2010, issued a written Corrective Work Order directing the Respondent to perform designated corrective work at the construction site. 9. The Corrective Work Order provides, in pertinent part, as follows: Complaint #2( Custom corporate graphics along front radius counter need to be replaced due to extensive scratches and damage caused by Last Detail. Contractor to correct by the appropriate means. Complaint #3( 5 weeks delay to owner due to late delivery of millwork. Last Detail promised and re-promised to deliver at certain dates and would then not show up and/or be out of town delivering/installing different projects. Laurshan had to keep a superintendent on site for an additional 3 weeks and the plumber & electrician had to be on call on certain days to hook up machines when the millwork was supposed to be in place and then the millworker would not show up and the plumber and electrician would send invoices for their journeymen being on call. Additionally, the owner feels his business was damaged financially due to the late delivery and poor quality of the millwork. The contract does not state the time allotted for this project. There is no liquidated damages clause. The work was substantially completed at the time of the jobsite inspection. Contractor to correct “corrective work order” items in the allotted time. 10. The Corrective Work Order also provides as follows: From a scheduling point of view and in order that the contractor may take corrective measures in an orderly and prompt manner, cooperation between the contractor and complainant is necessary. 11. Credible testimony and evidence established that the Respondent repeatedly contacted the Complainant in an attempt to gain access to the commercial property at issue in order to perform corrective work on the graphics along the front radius counter and that the Respondent was unable to gain access from the owner of the business to perform the directed corrective action.. 12. Construction work is not a perfect art, and generally, a contractor must be afforded a reasonable opportunity to perform corrective work before the Registrar suspends, revokes, or otherwise disciplines the contractor’s license. 13. The denial of access to the Respondent is found to be unreasonable 14. The three way dispute between the Complainant, the Respondent and the owner of the business at issue, including the business owner’s claim for monetary damages and the Respondent’s claim for the remaining amount allegedly due the Respondent under the terms of the parties’ construction agreement, is found to constitute a good faith dispute which will necessarily involve a monetary adjudication and which can be resolved in a civil court of competent jurisdiction.

CONCLUSIONS OF LAW 1. The Complainant has the burden of demonstrating by a preponderance of the evidence that the Respondent violated the charged sections of the state’s contracting laws. See Culpepper v. State of Arizona, 187 Ariz. 431, 437-38, 930 P.2d 508 (Ariz. App. 1996). 2. Proof by “preponderance of the evidence” means that it is sufficient to persuade the finder of fact that the proposition is “more likely true than not.” In re Arnold and Baker Farms, 177 B.R. 648, 654 (9th Cir. BAP (Ariz.) 1994). 3. Proof by preponderance of the evidence “is evidence which is of greater weight or more convincing than the evidence which is offered in opposition to it; that is, evidence which as a whole shows that the fact sought to be proved is more probable than not.” Black’s Law Dictionary 1182 (rev. 6th ed. 1990). 4. The Respondent bears the burden to establish affirmative defenses, such as lack of access, by the same evidentiary standard. A.A.C. R2- 19-119 (B) (2). 5. The Respondent established that it was denied reasonable access to the business entity at issue and that the Respondent was unable to comply with the terms of the Corrective Work Order because of the unreasonable denial of access. RECOMMENDed order In view of the foregoing, it is recommended that this matter be dismissed. 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, November 18, 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