ALJDEC decisions subject to certification as final

2010A-308471933-ROC · Registrar of Contractors · 2010-10-22

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 19, 2010 at 1:00 p.m. APPEARANCES: The Complainant appeared through its authorized representative, John Quijada. The Respondent appeared through its authorized representative, Bernard Kroll. 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 License B-1.213759-C issued by the Registrar of Contractors. 2. The Complainant submitted written proposals for the installation of CCTV/MATV systems and nurse call systems for a construction project wherein the Respondent was functioning in its capacity as a general contractor. 3. There was no dispute that the parties entered into a written contract for the Complainant to install the CCTV/MATV and nurse call systems in the hospital where the construction project was taking place. 4. Credible testimony and evidence established that on May 19, 2009 the Complainant issued a Letter of Transmittal which contained six (6) sets of drawings for the nurse call systems and six (6) sets of equipment submittal booklets. 5. There was no dispute that the Respondent received the Letter of Transmittal with the drawings and the equipment submittal booklets. 6. Credible testimony and evidence established that on August 21, 2009 the Complainant issued a second Letter of Transmittal containing six (6) sets of revised nurse call system drawings and six (6) sets of revised equipment submittal booklets. 7. There was no dispute that the Respondent received the Letter of Transmittal with the revised drawings and revised equipment booklets. 8. Credible testimony and evidence established that the revised drawings and revised equipment booklets were reviewed by Spectrum Engineering and that the reviewer acknowledged that the Complainant had utilized Tektone nurse call equipment for the nurse call systems. 9. Credible testimony and evidence established that on November 30, 2009 a punch list of requested corrective work was issued to the Complainant by the Respondent. 10. The Respondent’s punch list provides, in relevant part, as follows: 1) Nurse Call: All dome lights, per the contract drawings have been installed and tested. The pillow speakers will be delivered and installed on the site once the beds for the rooms have been delivered and installed. The patient room fixtures mentioned on page 1, item #1 or Spectrum’s review has been tested and do control the light fixtures. However, before SWI can fully test and turn over the nurse call system for the owner’s use, Southwest must have room description information, a sequence of operations and other function information from the nursing staff. 11. Credible testimony and evidence established that there was no indication from the Respondent, the Architect or the Engineer or the owner that the submitted and installed Tektone nurse call systems were unacceptable or that the installed Tektone systems failed to comply with applicable specifications. 12. Credible testimony and evidence established that the Respondent issued an email to the Complainant on January 14, 2010 which provides as follows: Confirm your final payment in the amount of $23,256.60. Once confirmed payment with [sic] be made within 2 weeks. 13. Credible testimony and evidence established that on January 20, 2010 and February 13, 2010 the Complainant provided training for the nursing staff that would be using the new Tektone systems. 14. Credible testimony and evidence established that on February 3, 2010 the Respondent issued an email to the engineer who provides, in pertinent part, as follows: “Sam, I verified that our subcontractor he [sic] is available to meet with you tomorrow @ 1030 am to review the special systems now that it is 100% complete.” 15. On February 3, 2010 the Respondent issued an email to the Complainant which provides as follows: A final check in the amount of $23,256.60 has been cut and waiting for you to pick up since 1/18/10. However, the Owner and Architect have recently question [sic] the Nurses Call Station since they believe that it does not meet specifications. Your office is aware of this problem. We cannot release the final check until this question is resolved.

16. Credible testimony and evidence, presented at hearing, established that the nurse call systems installed by the Complainant do comply with applicable plans and specifications. 17. Credible testimony and evidence, presented at hearing, established that approximately half of the $23,256.60 claimed by the Complainant is based upon unpaid work relating to the CCTV/MATV system installed by the Complainant which has never been questioned by the Respondent or the Engineer or the Architect or the owner. 18. Credible testimony and evidence establishes that the sum of $23,256.60 is the proper balance due and owing to the Complainant from the Respondent. 19. There was no dispute that notwithstanding repeated attempts and billings over a prolonged period of time, said balance remains unpaid. 20. The Respondent ‘s failure to pay the aforementioned sum of $23, 256.60 to the Complainant is not found to be in good faith and accordingly, under all of the facts and circumstances presented herein the Respondent’s conduct is found to constitute a violation of the applicable charged provision of the State’s contracting laws. 21. The Complainant’s claims for damages and interest are found to be items which can be addressed in a civil court of competent jurisdiction. 22. The credible testimony and evidence of record is found to be insufficient to support a finding that the Respondent violated the charged provisions of A.R.S. § 32-1154 (A) (13): Namely; A.R.S. § 32- 1124(B) (Posting and placement of license number). CONCLUSIONS OF LAW 1. Credible testimony and evidence supported findings that establish that the Respondent violated the charged provisions of A.R.S. § 32-1154 (A) (11). (Failure to pay monies in excess of $750.00 when due). RECOMMENDED ORDER In view of the foregoing, it is recommended commencing on the effective date of the Registrar’s Order that License No. B-1.213759-C of the Respondent be suspended until the Registrar receives and accepts written proof that the Respondent has paid the sum of $23,256.60 to the Complainant. It is further recommended that if the Respondent pays the above described sum of money on or before the effective date of the Registrar’s Order then the aforementioned License suspension shall not take place and that this matter be closed. 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, October 22, 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