ALJDEC decisions subject to certification as final

2011A-4504-ROC · Registrar of Contractors · 2011-12-20

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: December 14, 2011, at 8:00 a.m. APPEARANCES: Complainant Manuel Madera appeared on his own behalf; Respondents The Fix It Guy, Inc. and Evolution R & C, L.L.C. did not appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT Background and Procedure In February 2000, the Arizona Registrar of Contractors (“the Registrar”) issued License No. B-3.151858-R for residential general remodeling and repair to The Fix It Guy, Inc. (“The Fix It Guy” or “Respondent”). Guyton Shackleford is The Fix It Guy’s qualifying party and officer. The Fix It Guy’s address of record is 4412 West Cathy Circle, Glendale, Arizona 85308- 3535. In February 2011, the Registrar issued License No. B-3.270950-R to Evolution R & C, L.L.C. (“Evolution” or “Respondent”). Mr. Shackleford is Evolution’s qualifying party and member. Evolution’s address of record is also 4412 West Cathy Circle, Glendale, Arizona 85308-3535. On or about March 14, 2011, the Registrar received a complaint from Manuel Madera (“Complainant”) against Evolution regarding its failure to perform a contract to repair the roof on Complainant’s house at 6014 North 61st Drive, Glendale, Arizona after Complainant paid Evolution $5,078.17 for the work. The Registrar opened a complaint against Evolution and designated it as Case No. 2011-4504. The Registrar also opened a complaint against The Fix It Guy and designated it as Case No. 2011-3510. On September 9, 2011, the Registrar issued a Citation and Complaint against The Fix It Guy in Case No. 2011-3510, charging violations of A.R.S. § 32- 1154(A)(1), (10), (13), namely A.R.S. § 32-1124(B), and (15). On September 9, 2011, the Registrar issued a Citation and Complaint against Evolution in Case No. 2011-4504, charging violations of A.R.S. § 32- 1154(A)(1), (13), namely A.R.S. § 32-1124(B), (15), and (20). Attorney Michael W. Thal of the law firm of Lang, Baker and Klain, P.L.C. filed timely written answers on behalf of both Respondents in Case Nos. 2011-3510 and 2011-4504, denying any statutory violations and affirmatively alleging that Evolution’s employee, Mark Bosworth, entered into a contract with Complainant and took his $5,078.17 without Evolution’s or The Fix It Guy’s knowledge or authorization. The Registrar referred Case Nos. 2011-3510 and 2011-4504 to the Office of Administrative Hearings (“the OAH”), an independent state agency, for a consolidated evidentiary hearing. On October 27, 2011, the Registrar issued a Notice of Hearing in Case No. 2011-3510 setting a hearing at the OAH on December 14, 2011, at 8:00 a.m. The Registrar mailed copies of the Notice of Hearing in Case No. 2011-3510 to The Fix It Guy at its address of record and to Mr. Thal. On October 27, 2011, the Registrar issued a Notice of Hearing in Case No. 2011-4504 setting a hearing at the OAH on December 14, 2011, at 8:00 a.m. The Registrar mailed copies of the Notice of Hearing in Case No. 2011-4504 to Evolution at its address of record and to Mr. Thal. Neither The Fix It Guy nor Evolution asked to appear telephonically at the consolidated hearing or requested that the hearing be continued. Although the start of the duly noticed hearing was delayed one hour and forty minutes to allow the OAH to secure a Spanish interpreter at Complainant’s request, Respondents did not appear through an authorized officer, member, employee, or attorney, and did not contact the OAH to request that the start of the hearing be further delayed. Consequently, Respondents did not present any evidence to defend their licenses. Complainant appeared, submitted four exhibits, and testified through interpreter Gabriela Contreras. According to the Registrar’s electronic record, as of the date of the hearing, The Fix It Guy’s license was suspended for lack of bond, twelve complaints were pending against The Fix It Guy’s license, and two complaints were closed as resolved, settled or withdrawn. According to the Registrar’s electronic record, as of the date of the hearing, Evolution’s license was suspended for lack of bond, ten complaints were pending against Evolution’s license, and one complaint was closed as resolved, settled or withdrawn. Hearing Evidence In October 2010, a hailstorm damaged the roof on Complainant’s house at 6014 North 61st Drive in Glendale, Arizona. One of Complainant’s friends referred Evolution to him to repair his roof. On January 7, 2011, Evolution’s salesman, Mark Bosworth, met Complainant at his house at 6014 North 61st Drive and presented a contract for Evolution to repair the roof for a price of $5,078.17. Mr. Bosworth also presented a contract for Evolution to issue a $1,000.00 credit to Complainant at the end of the job if he allowed Evolution to post its sign in his yard. The Fix It Guy’s license numbers were printed on the bottom of Evolution’s contract forms, but without the acronym “ROC.”[1] Complainant testified that Mr. Bosworth said that Evolution would seek the final payment for the roof repair from Complainant’s homeowner’s insurer. Complainant endorsed a check from his homeowner’s insurer made payable to Complainant in the amount of $5,078.17 and gave it to Mr. Bosworth for Evolution to begin repairs on the roof. Complainant’s insurer later provided documentation to Complainant that its check was deposited into Evolution’s account at Chase Bank. Complainant testified that no work was ever done on the roof. On or about February 8, 2011, Mr. Shackleford and Ty Riley on behalf of Evolution sent a letter to Complainant, informing him that Mr. Bosworth no longer worked for Evolution and that Evolution had changed its phone number and web site information. Complainant testified that he called Evolution and a man told him that Mr. Bosworth had broken into the business and committed theft. Complainant testified that after the letter was sent, no one contacted him about the contract to repair his roof and that Evolution eventually stopped answering its telephone. CONCLUSIONS OF LAW These consolidated matters lie within the Registrar’s jurisdiction.[2] The Notices of Hearing that the Registrar mailed to Respondents at their shared address of record and to their attorney were reasonable and Respondents are deemed to have received notice of the hearing.[3] The administratively suspended statuses of Respondents’ licenses do not deprive Complainant of his right to prosecute his complaints against Respondents or prevent the Registrar from determining the merits of Complainant’s complaints.[4] Complainant bears the burden of proof to establish cause for the Registrar to discipline Respondents’ licenses by a preponderance of the evidence.[5]

Because Evolution was not licensed when Mr. Bosworth on its behalf entered into two contracts with Complainant and took his $5,078.17, Complainant established in Case No. 2011-4504 that Evolution engaged in unlicensed contracting, in violation of A.R.S. § 32-1151.[6] Therefore, cause exists for the Registrar to discipline Evolution’s license under A.R.S. § 32- 1154(A)(20).[7] Complainant established that there is no real distinction between Evolution and The Fix It Guy because Evolution used The Fix It Guy’s license number to legitimate Evolution’s contracting business. Complainant also established that Evolution and The Fix It Guy either failed to supervise Mr. Bosworth or participated in the conversion of Complainant’s $5,078.17 by failing to perform any work whatsoever. Therefore, Complainant established that Evolution and The Fix It Guy abandoned the contract, in violation A.R.S. § 32-1154(A)(1).[8] Complainant established that The Fix It Guy acted in the capacity of contractor in a name other than as set forth on its license, in violation of A.R.S. § 32-1154(A)(15).[9] Complainant also established that The Fix It Guy aided and abetted Evolution, who was unlicensed at the time the contract with Complainant was made, to evade Title 32’s requirements for licensed contractors, in violation of A.R.S. § 32-1154(A)(10).[10] Because The Fix It Guy’s license numbers were printed on Evolution’s contract without the acronym, “ROC,” Complainant also established that The Fix It Guy and Evolution violated A.R.S. § 32-1154(A)(13), namely, A.R.S. § 32-1124(B).[11] RECOMMENDED ORDER Case No. 2011-3510 It is recommended that as a result of the violations that Complainant Manuel Madera established in Case No. 2011-3510, the Registrar revoke The Fix It Guy’s License No. B-3.151858-R. It is further recommended that if, on or before the effective date of the Registrar’s order, The Fix It Guy provides documentary proof that is acceptable to the Registrar that Complainant has been paid $5,078.17 by cashier’s or certified check, the Registrar not revoke The Fix It Guy’s license but, instead, close Case No. 2011-3510. 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. Case No. 2011-4504 It is recommended that as a result of the violations that Complainant Manuel Madera established in Case No. 2011-4504, the Registrar revoke Evolution’s License No. B-3.270950-R. It is further recommended that if, on or before the effective date of the Registrar’s order, Evolution provides documentary proof that is acceptable to the Registrar that Complainant has been paid $5,078.17 by cashier’s or certified check, the Registrar not revoke Evolution’s license but, instead, close Case No. 2011-4504. 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, December 20, 2011.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] The Registrar also issued License No. L-61.151859-C for commercial carpentry, remodeling, and repairs to The Fix It Guy. The Registrar did not charge that license as a result of Complainant’s complaint. [2] See 32-1101 et seq. [3] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [4] See A.R.S. § 32-1154(C). That statute provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such license, or to render a decision suspending or revoking such a license . . . .” [5] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119(A) and (B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [6] A.R.S. § 32-1151 prohibits engaging in contracting without a license and provides in relevant part as follows: It is unlawful for any person, firm, partnership, corporation, association or other organization, or a combination of any of them, to engage in the business of, submit a bid or respond to a request for qualification or a request for proposals for construction services as, act or offer to act in the capacity of or purport to have the capacity of a contractor without having a contractor's license in good standing in the name of the person, firm, partnership, corporation, association or other organization as provided in this chapter . . . . Evidence of . . . the employment of a person on a construction project shall be accepted in any court as prima facie evidence of existence of a contract. [7] A.R.S. § 32-1154(A)(20) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[s]ubsequent discovery of facts which if known at the time of issuance of a license or the renewal of the license would have been grounds to deny the issuance or renewal of the license.” [8] A.R.S. § 32-1154(A)(1) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” [9] A.R.S. § 32-1154(A)(15) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]cting in the capacity of a contractor under any license issued under this chapter in a name other than as set forth upon the license.” [10] A.R.S. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]iding or abetting a licensed or unlicensed person to evade this chapter, knowingly combining or conspiring with a licensed or unlicensed person, allowing one’s license to be used by a licensed or unlicensed person with intent to evade this chapter.” [11] A.R.S. § 32-1154(A)(13) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure in any material respect to comply with this chapter.” A.R.S. § 32-1124(B) requires that licensed contractors include their license number “preceded by the acronym ‘ROC’” on “all written bids submitted by the licensee and . . . on all advertising, loan forms, lending institution forms, letterheads and other documents used by the licensee in the conduct of business regulated by this chapter.”

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

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