ALJDEC decisions subject to certification as final

2011A-2664-ROC · Registrar of Contractors · 2011-11-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 18, 2011 APPEARANCES: Jeff Cohen appeared on behalf of Complainant Custom Cabinetry by Design. Fidelis V. Garcia, Esq., represented Respondent Southwest Field Asset Services, L.L.C., doing business as Nexgen Builders. ADMINISTRATIVE LAW JUDGE: Sondra J. Vanella _____________________________________________________________________ The question presented by this matter is whether Respondent Southwest Field Asset Services, L.L.C., doing business as Nexgen Builders (“Nexgen”), is subject to discipline for acts or omissions in violation of A.R.S. § 32- 1154(A). Based on the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: FINDINGS OF FACT 1. Nexgen is the holder of a Class KB-1 license (No. 250312) issued by the Registrar of Contractors (“ROC”). James Henneberry is Nexgen’s qualifying party and an employee of Nexgen. Nexgen was the general contractor for a kitchen remodel project. 2. Complainant Custom Cabinetry by Design (“Custom”) was the supplier of the cabinets for the remodel project. Custom does not hold a contractor’s license. 3. Nexgen contracted with Custom for Custom to “supply material and/or labor” for “Cabinets as per plan and specifications . . . .” See Exhibit 1. The total contract price was $5,764.00, with $2,882.00 due upon the delivery of the cabinets. Id. Nexgen paid $2,882.00 to Custom. 4. On May 6, 2011, Custom filed a complaint against Nexgen with the ROC alleging non-payment by Nexgen in the amount of $3,082.00. 5. At the hearing, Jeff Cohen, Custom’s owner, testified that Custom sells its product and allows others to install it. However, Mr. Cohen also testified that Custom will have one of its employees, Jason Miller, owner of and qualifying party for Miller Finishing Carpentry, License No. ROC203917, install Custom’s product if requested. 6. Mr. Cohen testified that when the job was complete, Nexgen issued a check to Custom and then immediately stopped payment on the check. 7. Mr. Henneberry testified that Custom’s scope of work included supplying the cabinets and installing them, and that Custom did so. However, Mr. Henneberry testified that Custom mis-measured the cabinets from the outset, resulting in the cabinets not being installed centered over the sink, with gaps on the sides of the cabinets. Mr. Henneberry testified that Mr. Cohen had been to the jobsite, made changes to the plans, but failed to communicate those changes to Custom’s installer prior to installation, resulting in improper installation. See Exhibits A and 3. Due to this error, once the cabinets were installed, they had to be removed, necessitating the removal of the granite countertop, which broke during removal. Custom agreed to pay for half of the replacement countertop, in the amount of $650.00. Further, the cabinets were damaged when the countertop was removed. Nexgen incurred the expense of installing temporary countertops for the homeowner, as well as additional expenses to remedy the faulty installation, including the countertop replacement, and plumbing and electrical work, in the total amount of $1,916.98. See Exhibits C and D. 8. Mr. Henneberry testified that Nexgen issued a final check to Custom because Custom would not release materials that were necessary for completing the cabinet installation without payment. However, due to deficiencies in installation, Nexgen stopped payment on the check. After offsets are taken into account, Nexgen acknowledged that it owes Custom the sum of $515.02. 9. Mr. Cohen testified that per the cabinet design, the upper cabinets do not line up with the lower cabinets, and Custom made corrections to the upper cabinets. Mr. Cohen testified that, therefore, he does not know why the lower cabinets were removed and replaced. CONCLUSIONS OF LAW 1. In this proceeding, Custom bears the burden to prove, by a preponderance of the evidence, that Nexgen is subject to discipline for a violation of A.R.S. § 32-1154(A)(11) as charged by the ROC in its July 29, 2011 Citation and Complaint. See Arizona Administrative Code R2-19-119. 2. A preponderance of the evidence is “such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). 3. The Administrative Law Judge concludes that Custom failed to meet its burden of proof as to the ROC's charge. 4. Under A.R.S. § 32-1154(A)(11), a contractor is subject to discipline for the “failure . . . 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.” The credible evidence of record demonstrates that Nexgen owes Custom the total amount of $515.02, less than the statutory threshold requirement of $750.00 for a violation of the charged statutory provision. Nexgen established that it is entitled to offsets based upon Custom’s faulty installation of the cabinets, specifically due to Custom’s failure to timely communicate the changes in the plans to Custom’s installer. Therefore, under all of the facts and circumstances presented herein, Nexgen is not in violation of A.R.S. § 32-1154(A)(11). 5. The Administrative Law Judge concludes, based upon the weight of the credible evidence of record, that no grounds exist to impose discipline against Nexgen’s license. The ROC’s Citation in Case Number 2011-2664, and the Complaint upon which it is based, should be dismissed. RECOMMENDED ORDER Based on the foregoing, the Administrative Law Judge makes the following Recommended Order: It is recommended that no discipline be imposed against Nexgen’s license and that the Citation issued in Case Number 2011-2664, together with the Complaint upon which it is based, 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, November 2, 2011.

/s/ Sondra J. Vanella 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