ALJDEC decisions subject to certification as final

2011A-7061-ROC · Registrar of Contractors · 2012-06-04

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 23, 2012, at 1:00 p.m. APPEARANCES: Complainant appeared on his own behalf. Respondent appeared through its authorized representative, Clint Hyman. ADMINISTRATIVE LAW JUDGE: M. Douglas

Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law and Recommended Order are made: FINDINGS OF FACT 1. Respondent is the holder of License No. K-42-265407-D issued by the Registrar of Contractors. 2. Complainant testified that he entered into a contract in June 2011, with an entity identified as “Countrywide Shingle & Siding LLC” [1] to repair his roof after it was damaged by hail. That written contract is part of the complaint file and reflects a “Repair Work Order/Invoice” signed by Complainant. The Repair Work Order/Invoice is a form document with the details filled in by hand that show that the work included materials and installation for replacing the roof. The form is printed with a heading showing “Countrywide Shingle,” and below that, “ROC: 265407,” which is Respondent’s license number. The form document also contains the name “Countrywide Shingle & Siding, LLC” in bold letters above the address and telephone numbers provided. 3. Pursuant to the terms of the construction agreement, Complainant paid the sum of $3,178.64 to “Countrywide Shingle & Siding LLC.” The money paid was in the form of an insurance proceeds check endorsed over to “Countrywide Shingle & Siding LLC.” 4. No work was done on Complainant’s roof. Complainant was in repeated contact with “Countrywide Shingle & Siding LLC” at the telephone number listed on the contract (602-484-9000), but there always appeared to be some problem that kept the work from commencing. 5. In October 2011, Complainant received a letter from “Countrywide Shingle & Siding LLC” apologizing to Complainant for the delay in replacing his roof. The letter is signed by Tammy Hunt, Business Manager, for “Countrywide Shingle & Siding LLC.” It is apparent that the letter was issued to Complainant on the basis of the June 2011 contract with “Countrywide Shingle & Siding LLC.” 6. There was no dispute that “Countrywide Shingle & Siding LLC” is not a licensed contractor in the State of Arizona. 7. After six months of delay, Complainant filed a formal complaint against “Countrywide Shingle & Siding LLC ” with the Registrar of Contractors. 8. Pursuant to the filing of the formal complaint, an assigned Agency Inspector reviewed the matter and discovered that the contractor’s license number utilized by “Countrywide Shingle & Siding LLC” belonged to Respondent and processed the complaint against Respondent. 9. Respondent entered into a fee agreement with the unlicensed entity “Countrywide Shingle & Siding LLC,” wherein Respondent agreed to combine with the unlicensed entity and enter into combined construction agreements with homeowners in the State of Arizona for roofing work. Pursuant to the terms of the fee agreement, Respondent agreed to perform all necessary roof construction work for an agreed upon sum per roofing square, and the unlicensed entity agreed to solicit roofing work from homeowners and to provide all necessary roofing materials and equipment.[2] 10. Respondent knowingly and recklessly assisted an unlicensed entity to enter into a construction agreement with Complainant and then abandoned the construction project and refused to perform the agreed upon roofing work on Complainant’s residence. 11. Respondent is found to be fully responsible for the actions of the unlicensed entity that Respondent knowingly and recklessly combined with in an effort to evade the state’s contracting laws. 12. Administrative notice is taken of Respondent’s prior License record as reflected on the Registrar of Contractors’ public website on May 31, 2012. Such prior License record reflects that License No. K-42-265407-D of Foresight Roofing, LLC dba Countrywide Shingle was revoked on February 6, 2012, revoked on February 27, 2012, revoked on February 28, 2012, and revoked twice on May 16, 2012. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing is generally upon a complainant.[3] Further, the standard of proof at hearing is by preponderance of the evidence.[4] 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.[5] Complainant has met that burden. 2. The Citation and Complaint alleges violations of A.R.S. § 32-1154(A)(1) (prohibiting abandonment of a project). A.R.S. § 32-1154(A)(10) (aiding or abetting a licensed or unlicensed person to evade this chapter), A.R.S. § 32-1154(A)(13), namely, A.R.S. § 32-1124(B) (display of license preceded by the acronym, “ROC”), and A.R.S. § 32-1154(A)(15) (prohibiting acting in a name other than that on the license). 3. There was no dispute that Complainant’s construction project was abandoned. 4. This tribunal finds that Respondent is accountable for the abandonment because Respondent set up a situation that was ripe for abuse in its arrangement with “Countrywide Shingle & Siding LLC.” The arrangement that Respondent apparently intended, as expressed in Clint Hyman’s testimony,[6] was for the unlicensed entity “Countrywide Shingle & Siding LLC” to make customer referrals and sell Respondent materials for installation. Such an arrangement, however, did not require Respondent to change its name to Foresight Roofing, LLC dba Countrywide Shingle, which could only serve to confuse the public and blur the lines between the licensed and unlicensed entities. Respondent’s action of knowingly and recklessly combining with unlicensed “Countrywide Shingle & Siding LLC” in the above-described business venture is the basis for holding Respondent responsible for the abandonment of Complainant’s project and to conclude that Respondent knowingly violated the charged provisions of A.R.S. § 32-1154(A)(10) (aiding and abetting). 5. Although “Countrywide Shingle” was an authorized business name for Respondent, the printed form used in the June 2011 contract with Complainant also used the name, “Countrywide Shingle & Siding LLC,” as did follow-up correspondence with Complainant by that entity. Because Respondent’s arrangement with “Countrywide Shingle & Siding LLC,” make its acts attributable to Respondent, Respondent acted in a name other than that on its license, in violation of A.R.S. § 32-1154(A)(15). 6. The printed form used in the June 2011 contract with Complainant included Respondent’s license number, but was not preceded by the acronym, “ROC.” Therefore, the evidence established that Respondent violated the charged provisions A.R.S. § 32-1154(A)(13), namely, A.R.S. § 1124(B). RECOMMENDed order In view of the foregoing, it is recommended that License No. K-42- 265407-D of Foresight Roofing, LLC dba Countrywide Shingle shall be revoked. In the event of certification of this 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 the certification.

Done this day, June 18, 2012.

/s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors

----------------------- [1] The unlicensed entity used two names on the contract. The Decision will reflect the name Countrywide Shingle & Siding LLC for the unlicensed entity in quotations throughout the Decision to avoid confusion with Respondent’s name. [2] Exhibit No. R-1 (January 11, 2011 Fee Agreement). [3] Utah Construction Company v. Berg et al, 68 Ariz. 285, 205 P.2d 367 (1949). [4] Smith v. Arizona Dept. of Transportation, 146 Ariz. 430, 706 P.2d 756 (App. 1985). [5] Culpepper v. State, 187 Ariz. 431, 437, 930 P.2d 508, 514 (Ct. App. 1996). [6] May 23, 2012 Hearing Record at 25:49-31:30.

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