ALJDEC decisions subject to certification as final

2010A-4214701-ROC · Registrar of Contractors · 2010-09-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 1, 2010

APPEARANCES: Complainant was represented by Ramon Carrasco, CFO; Respondent was represented by General Manager Gene Weinstein and Superintendent Patrick Mulvena. Corporate President Bruce Berres was also present.

WITNESSES: For Complainant: Ramon Carrasco

For Respondent: Gene Weinstein Patrick Mulvena Bruce Berres

ADMINISTRATIVE LAW JUDGE: Eric A. Bryant _____________________________________________________________________

Complainant brings this action claiming that it is owed over $795.00 from Respondent for work Complainant performed as a subcontractor on an apartment restoration project for which Respondent was the general contractor. The parties agree that Respondent has paid most of the amount due, but Respondent denies that further payment is owed to Complainant. This tribunal entered the complaint file received from the Registrar of Contractors into the record, with the addition of Complainant’s Exhibit A. The parties presented evidence and testimony at the hearing. Based upon the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Decision finding no violation of the provisions applying to licensed contractors.

FINDINGS OF FACT 1. Respondent is the holder of a class B-1 general commercial contractor license (No. 130669) issued by the Registrar of Contractors (“ROC”). That license authorizes Respondent to perform general construction of a commercial structure or appurtenance, except for certain specialty contracting such as electrical, plumbing, swimming pools, etc. 2. Complainant is a plumbing subcontractor who was hired by Respondent to perform rough and finish plumbing work at an apartment complex in Tucson, Arizona. The work was in the kitchen and bathroom of a fire damaged apartment that Respondent was restoring. 3. Complainant performed the rough work. Complainant claims that Respondent breached the contract when Respondent did not contact Complainant to come back out and do the finish work. 4. Respondent claims that Complainant breached the contract by not being available to come back out to do the finish work when Respondent needed Complainant to do so. Respondent paid a large portion of the invoice sent to it, but not all of it. 5. Complainant filed its complaint with the ROC, believing that it is entitled to the remaining amount due, in the amount of $795.00. 6. The evidence shows a good faith contractual dispute between the parties. Respondent’s position that it did not breach the contract is held in good faith.

CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[1] Further, the standard of proof at hearing is by preponderance of the evidence.[2] 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.[3] Complainant has not met that burden. 2. The Citation and Complaint cites the “no pay’ provision found in Arizona Revised Statutes (A.R.S.) § 32-1154(A)(11) that prohibits the failure of a licensee to pay monies in excess of $750 “when due for materials or services” when the licensee has the capacity to pay or when the licensee has been paid for the project. 3. The evidence is not sufficient to show that Respondent has violated those statutes cited in the Citation and Complaint. The basis for Complainant’s claim is not clear. At one point, Complainant was arguing that the amount due was for a verbal change order. Yet, the contract between the parties requires written change orders. The other part of the dispute was about the call-back, a matter which the parties clearly dispute in good faith. The evidence, however, does not provide a clear basis for discipline. Parties to a contract may have a good faith dispute about their obligations under a contract that would be appropriate for a civil court action but would not rise to the level of a disciplinary violation on a determination that the amount was due and owing as alleged in the Citation and Complaint. A good faith dispute about payment issues should not result in disciplinary action against a license. Those disputes can be taken to court. 4. Complainant has failed to show a violation of statutes by Respondent. 5. This matter should be dismissed.

RECOMMENDED ORDER Based on the foregoing, it is hereby recommended that the Citation and Complaint against Respondent VBS Construction, Inc. in case 2010- 4214701 (formerly T10-0421) be dismissed.

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, September 10, 2010.

/s/ Eric A. Bryant Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [2] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [3] See Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996) (moving party bears burden of proof by preponderance of evidence in an administrative hearing).

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