ALJDEC decisions subject to certification as final

2011A-3212-ROC · Registrar of Contractors · 2011-11-08

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: October 24, 2011

APPEARANCES: Complainant appeared on her own behalf; Respondent was represented by corporate President Patty Mack and CEO/Qualifying Party Doug Mack.

WITNESSES: Lynn Heinsohn Doug Mack Patty Mack

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. Respondent denies the allegation. This tribunal entered the complaint file received from the Registrar of Contractors into the record. 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 no abandonment. FINDINGS OF FACT 1. Respondent is the holder of license B-3.128499-R, a general residential contracting license issued by the Registrar of Contractors (“ROC”). The license authorizes Respondent to perform general remodeling and repair for residential projects. Doug Mack is the Qualifying Party. 2. On April 20, 2011, Complainant entered into a contract with Respondent for roof replacement and repair due to damage by a hail storm. By written terms of the contract, work was to begin on May 4, 2011, and be completed by June 15, 2011. Payment terms were that Complainant was to pay one-third of the contract price at signing. The contract contains no written provision for cancellation or termination of the contract. 3. Because Complainant did not have the down payment at the time the contract was signed, the parties agreed that Complainant could arrange the payment through her bank, to be made by April 30, 2011. Complainant made the arrangement. 4. On April 27, 2011, Complainant sent Respondent an e-mail suggesting that Respondent use a roofing subcontractor that Complainant had already contacted as part of the earlier bidding process. 5. In response, Doug Mack called Complainant on the telephone. Complainant testified that Mack was upset and told her that he was rescinding the contract. Doug Mack testified that he thought Complainant was asking him to engage in insurance fraud and stated that he could rescind the contract, not that he was doing so. 6. After that telephone conversation, the same day, Complainant sent another email to Respondent stating that she had not meant to make Mack upset and that her intentions were honorable. She stated that the initial payment was on its way to Respondent and could no longer be changed or cancelled, but that if Respondent chose not to do the work she wanted the payment ($6,000.00) returned. 7. Two days later, April 29, 2011, Complainant emailed Respondent and stated that the bank check had been mailed to Respondent. She also stated that she believed that Respondent had “decided to withdraw” from the contract and “pulled out” of the agreement. She wanted to make arrangements for getting the check back without Respondent cashing it. 8. The next day, April 30, 2011, Respondent, through Patty Mack, sent an email to Complainant stating that Respondent had not yet received the check and that Doug Mack “has nearly completed your blueprints, we have all put a lot of time and effort into this project!” The email then states, “If you are still willing to utilize Sun Valley Remodeling as your General Contractor to complete your repairs, patio, etc. we will finish the blueprints and apply for the permit. Let me know what you would like to due [sic].” 9. Before hearing back from Complainant, Respondent received Complainant’s check and deposited it. 10. On May 3, 2011, Complainant sent an email to Respondent stating that the funds had been withdrawn from the bank and that Complainant did not want to go forward with the contract with Respondent. She asked for a return of the money. 11. Respondent did not immediately return the payment, but clearly considered the contract terminated because Respondent did not attempt to do any further work. On June 16, 2011, Respondent created an invoice that listed preparation work that Respondent had done including “Blueprints” for $500.00, “Office Expenses” for $500.00, and “Loss of Profit” for $1,351.28. This created a total invoice amount of $2,351.28. Respondent kept that amount and issued a check to Complainant for $3,648.72, the sum obtained after $2,351.28 is subtracted from $6,000.00. The check is dated June 29, 2011. 12. Complainant received the check and still has it, but has not cashed or deposited it for fear that it would waive her rights to the rest of the $6,000.00 she claims she is owed. 13. The Administrative Law Judge finds that the greater weight of the credible evidence shows that on April 30, 2011, Respondent offered Complainant a chance to withdraw from the contract without any stipulations. Respondent had not abandoned the project at that time. Complainant took the offer and there is now a money dispute between the parties. The evidence does not show abandonment because Respondent offered Complainant withdrawal from the contract, which Complainant accepted. / / / / / / / / /

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 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. As noted above, the evidence does not support a conclusion that Respondent abandoned the contract. 3. As the evidence shows, Respondent did not abandon the contract with Complainant. Rather, Respondent offered Complainant withdrawal from it. There remains a money dispute between the parties, but that dispute can be adjudicated in the court system. 4. This matter should be dismissed. RECOMMENDED ORDER IT IS RECOMMENDED that case 2011-3212 against Sun Valley Remodeling, Inc. 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 8, 2011.

/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] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996).

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