ALJDEC decisions subject to certification as final

2010A-308477550-ROC · Registrar of Contractors · 2011-07-28

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 7, 2011

APPEARANCES: Complainant appeared on her own behalf; Respondent was represented by attorney Scott Miskiel, accompanied by Managing Member George Calder.

WITNESSES: Joanne Fritz George Calder

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant brings this action claiming that Respondent, without legal excuse, abandoned the project for which Respondent had been hired. Complainant requests a return of the money she has paid Respondent. Respondent denies the allegation. This tribunal entered the complaint file received from the Registrar of Contractors into the record, along with Complainant’s Exhibits C1 through C18 (excluding C10), as well as Respondent’s Exhibit R5.[1] The parties presented evidence and testimony from the witnesses listed above. Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Decision finding abandonment of the project.

FINDINGS OF FACT 1. Respondent is the holder of license C-11.259316-R, a specialty residential contractor’s license issued by the Registrar of Contractors (“ROC”). The license authorizes Respondent to install and repair electrical systems for residential projects. Paul Cooley is the current Qualifying Party. 2. In April 2010, Complainant hired Respondent to install a solar electrical system at her home. A substantial and integral part of the contract was a rebate program from electric utility company Arizona Public Service (“APS”). Complainant secured a “reservation” from APS on April 9, 2010, that is required for the rebate.[2] The contract, dated April 20, 2010, states that its commencement date was April 20, 2010, and that “Time is of the essence.”[3] There is no completion date in the contract, but the section pertaining to insurance coverage states that coverage was required to be in place until June 8, 2010. Furthermore, Complainant credibly testified that George Calder assured her that the installation would be complete before Complainant went to Colorado, which she was planning to do in late May. 3. On April 20, 2010, Complainant paid Respondent $14,169.08 of the contract price,[4] leaving a balance of $1,328.92 that was due upon completion of the installation.[5] Respondent ordered the materials and began the installation. Complainant went to Colorado in late May. When Complainant left Arizona, the installation was not complete. However, Calder told Complainant that they could do the work without her being present. 4. In mid-June 2010, while installation was proceeding, Respondent’s Qualifying Party/electrician walked off the job and quit the company. Work stopped at that point because an electrician was necessary to continue the work. George Calder testified that he found a replacement Qualifying Party/electrician two weeks later, but had to wait for the ROC to approve that person, which took until October 2010. 5. ROC records show that Respondent’s license was suspended for lack of Qualifying Party from August 14, 2010 to October 6, 2010.[6] This means that Respondent’s license was active during July 2010 and the first two weeks of August 2010. Respondent also had an electrician on staff at that time. 6. During the Summer of 2010, Complainant was not in Arizona. The first time she learned of the circumstances with Respondent’s license was during a telephone conversation with George Calder in late August 2010.[7] She became concerned about expiration of the APS reservation and obtained an extension on September 1, 2010, extending the date by which the equipment must be installed and pass APS inspection to January 16, 2011. The extension eased Complainant’s mind about the APS deadline. At that time, Complainant was willing to proceed with the job using Respondent. 7. There is no evidence that Respondent worked on the project in October 2010 and November 2010, after the license suspension was lifted. Complainant returned to Arizona in late October 2010. 8. Calder testified that he contacted Complainant immediately after the license was reinstated, but there is no corroboration of that statement and it contradicts Complainant’s testimony; therefore, it is not found to be credible. In addition, Calder testified that reinstatement of Respondent’s liability insurance was delayed throughout October 2010 and that he could not work during that time due to lack of insurance. Again, there is no corroborating evidence supporting that statement.[8] Thus, it is not credible.[9] Also, it does not address why work was not performed in November 2010. 9. On November 22, 2010, Complainant sent a letter to Respondent stating that Calder had not responded to voice messages that she left for him on November 3, 15, and 17.[10] She informed Respondent that because Respondent had not returned calls and time was running out on her extension, she was hiring another contractor to do the work. She requested a refund on her payment and asked Respondent to collect materials that had been left on the site. 10. Complainant entered into a new contract for solar equipment with another contractor on November 22, 2010. That contractor installed a solar electrical system in time for the APS rebate. 11. Calder testified that the delay in reinstating Respondent’s license was not caused by him. He testified that he attempted to continue working on the job when he appeared at Complainant’s home on November 17, 2010, but that Complainant would not provide access. Complainant testified that the attempt to complete the job occurred on December 6, 2010, after she had already hired the new contractor. As to the date that this interaction occurred, this tribunal finds Complainant’s testimony to be more credible, as it is consistent with the two letters written by Complainant, dated November 22, 2010, and December 28, 2010,[11] respectively. Those letters were written shortly after the events occurred. The greater weight of the evidence shows that Respondent‘s attempt to complete the contract occurred on December 6, 2010. 12. The evidence supports the reasonableness of Complainant’s hiring of the other contractor. Time was running out for her rebate and Respondent had not communicated with her for some time. Because of Respondent’s lack of communication and lack of performance, Complainant’s decision to hire another contractor was reasonable and not a breach of contract that would provide a legal excuse for Respondent’s failure to perform. Respondent had already abandoned the project. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[12] Further, the standard of proof at hearing is by preponderance of the evidence.[13] Therefore, Complainant bears the burden of showing, by a preponderance of the evidence, that Respondent has violated the statutes cited in the Citation and Complaint.[14] Complainant has met that burden. 2. The issue for decision in this matter is whether Respondent has violated (A.R.S.) § 32-1154(A)(1), which prohibits abandonment of a contract without legal excuse.[15] The evidence shows that Respondent abandoned the contract by failing to complete the project in a timely manner, at the latest by November 2010. 3. There is no apparent legal reason that Respondent could not have worked on and completed the project in July 2010 while its license was active and Respondent had an electrician on staff. Furthermore, after October 6, 2010, Respondent’s new Qualifying Party was approved and the suspension lifted. There is no evidence that Respondent attempted to complete the work in October 2010, and no credible evidence that an attempt was made in November 2010. By the time Complainant hired the new contractor in late November 2010, Respondent had abandoned the contract by failing to communicate with Complainant and failing to perform. Indeed, by Calder’s own testimony, installation of the system takes only one to two weeks. Respondent’s failure to get the work done and failure to even contact Complainant in October and November is a substantial lack of performance and constitutes abandonment. 4. The appropriate remedy in this matter is for Respondent to return Complainant’s payment of $14,169.08. If Respondent does not do so, Respondent’s license should be suspended. RECOMMENDED ORDER IT IS RECOMMENDED that license C-11.259316-R, held by Calder Renewable Energy, LLC, be suspended beginning the effective date of the Registrar’s Order until the Registrar receives written proof that Respondent has paid Complainant $14,169.08 and the Registrar of Contractors accepts such written proof. IT IS FURTHER RECOMMENDED that if Respondent provides such written proof on or before the effective date of the Registrar’s Order, the license suspension shall not take place and case 2010-[number redacted] shall be closed.

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, July 28, 2011.

/s/ Eric A. Bryant Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Exhibits C17 and R5 are identical. [2] Exhibit C2. [3] Exhibit C3. [4] Exhibit C4. [5] Id. [6] Based on these dates, it is determined that the ROC was informed that Respondent lost its Qualifying Party on June 14, 2010. This determination is based on A.R.S. § 32-1167(B), which states that a license is automatically suspended 60 days after a Qualifying Party disassociates from the license. [7] The evidence shows that Complainant initiated the call to Calder because she had been informed by friends and neighbors that no work was being done on the project. [8] No supporting documentation was submitted. [9] Even assuming the credibility of the statement, Calder testified that he “put [the insurance] on hold” when the license was suspended. This was not required and Calder must take responsibility for any subsequent delay in reinstating the insurance. [10] This letter is in the complaint file. [11] Exhibit C17/R5. [12] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [13] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [14] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996). [15] Allegations of violation of A.R.S. § 32-1154(A)(2) (failure to follow plans, specifications, or building codes) and (A)(3) by way of A.A.C. Rule R4-9-108 (failure to meet workmanship standards) are also made in the Citation and Complaint. However, Complainant’s presentation focused on the abandonment allegation and not any other.

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

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