ALJDEC decisions subject to certification as final

2012A-507-ROC · Registrar of Contractors · 2012-05-21

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 2, 2012 APPEARANCES: Charles Edward Bush appeared personally. The Registrar of Contractors was represented by Assistant Attorney General Montgomery Lee. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________ Charles Edward Bush and Fisher’s Landing, Inc. requested a hearing on the issuance of a civil citation and the assessment of a civil penalty against Mr. Bush by the Registrar of Contractors (“Registrar”) for unlicensed contracting.[1] An evidentiary hearing was scheduled before the Office of Administrative Hearings, an independent agency, in this matter. Based upon the evidence of record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order: FINDINGS OF FACT 1. Fisher’s Landing, Inc. is the owner of a resort (“Fisher’s Landing”) located in an isolated area approximately 50 miles north of Yuma, Arizona. 2. Fisher’s Landing is located on land that was first leased to the Fisher family in 1948. The land was originally owned by the Bureau of Land Management, but was transferred in 1984 to the Arizona State Land Department in a land swap. 3. Fisher’s Landing, Inc. is the current leaseholder of the land. 4. Fisher’s Landing, Inc. owns all the facilities at Fisher’s Landing, including the gas dock, boat shop, store, bar and grill, and 340 mobile home lots with water and electricity. Fisher’s Landing, Inc. also owns a water and sewer company that serves the resort. 5. Fisher’s Landing, Inc. has been doing all the required maintenance in- house for Fisher’s Landing since 1948. 6. Mr. Bush is Fisher’s Landing’s manager and one of its owners. 7. Mike Foster is an investigator for the Registrar who is assigned to the Yuma area. 8. Daryl McCloskey is an inspector for the Registrar who is also assigned to the Yuma area. 9. On January 23, 2012, Investigator Foster received a telephone call from Patrick Headington of the Yuma County Development Services inviting Investigator Foster and Inspector McCloskey to join him when he inspected Fisher’s Landing for code compliance. 10. On January 27, 2012, Investigator Foster and Inspector McCloskey joined Mr. Headington for the inspection of Fisher’s Landing. Upon arriving at Fisher’s Landing, the group was met by Mr. Bush, who proceeded to take the group to a jobsite on the property. 11. At hearing, Investigator Foster testified that he observed two new replacement electrical pedestals, new replacement sewer lines, upgraded water supply pipes, and new grading for four mobile home lots. Investigator Foster took photographs of the jobsite work. See Exhibits 1 through 12. 12. After viewing the work and after Mr. Bush was interviewed by Mr. Headington, Investigator Foster and Inspector McCloskey spoke with Mr. Bush, who admitted to them that he and a maintenance worker employed by Fisher’s Landing, Inc. had performed the above-described work as maintenance work for Fisher’s Landing. Mr. Bush is not a licensed commercial contractor. 13. At the jobsite, Investigator Foster issued a Cease and Desist Order to Mr. Bush requiring him to stop all construction work on the jobsite. Investigator Foster informed Mr. Bush that in order to come into compliance with the county requirements, he would have to hire a licensed commercial contractor to inspect and/or complete the work. 14. After returning to his office, Investigator Foster conducted a search for Mr. Bush in the Registrar’s database. Investigator Foster discovered that Mr. Bush had been previously issued a citation for unlicensed contracting in 2009.[2] 15. Investigator Foster issued a civil citation to Mr. Bush that charged him with violating the provisions of A.R.S. § 32-1151 for contracting without a license. 16. At hearing, Investigator Foster and Mr. Bush testified consistently about the facts in this matter. However, Mr. Bush contends that Fisher’s Landing, Inc. should have been cited rather than Mr. Bush personally. 17. There is no evidence that Mr. Bush charged any fee for the work performed by him on the subject project other than whatever compensation he may have received as the property’s manager. CONCLUSIONS OF LAW 1. Pursuant to A.A.C. R2-19-119(B), the Registrar has the burden of proving that Mr. Bush violated the provisions of A.R.S. § 32-1151, as charged in the civil citation issued to him. The standard of proof is by a preponderance of the evidence. A.A.C. R2-19-119(A). Although Fisher’s Landing, Inc. is named in the Notice of Hearing on Citation and Civil Penalty, it was not issued the subject citation. 2. The Registrar issued a civil citation charging Mr. Bush with violating the provisions of A.R.S. § 32-1151, which 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, unless the person, firm, partnership, corporation, association or other organization is exempt as provided in this chapter.

3. A.R.S. § 32-1101(A)(3)(a) defines a contractor as follows: “Contractor” is synonymous with the term “builder” and means any person, firm, partnership, corporation, association or other organization, or a combination of any of them, that, for compensation, undertakes to or offers to undertake to, purports to have the capacity to undertake to, submits a bid or responds to a request for qualification or a request for proposals for construction services to, does himself or through others, or directly or indirectly supervises others to: (a) Construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building, highway, road, railroad, excavation or other structure, project, development or improvement, or to do any part thereof, including the erection of scaffolding or any other structure or work in connection with the construction.

(Emphasis added).

4. The analysis in Levitan v. State, Registrar of Contractors, 201 Ariz. 225, 33 P.3d 796 (App. 2001), is persuasive in this matter. In Levitan, the plaintiff was the owner of two rental residential properties. The Court of Appeals determined that Mr. Levitan’s obligation to repair and maintain his rental properties derived from A.R.S. § 33-1324(A)(2) that requires a landlord to “[m]ake all repairs and do whatever is necessary to put and keep the premises in a fit and habitable condition.” 201 Ariz. at 226, 33 P.3d at 797. The Court of Appeals found that the payment of rent by a tenant does not constitute compensation for repairs or improvements to rental property. The Court of Appeals concluded that Mr. Levitan did not receive compensation for the repairs he performed on his rental property, and therefore, he was not a contractor as defined in A.R.S. § 32- 1101(A)(3). 201 Ariz. at 227, 33 P.3d at 798. 5. In this matter, Fisher’s Landing, Inc. is a lessee of the subject property who subleases mobile home lot space with utilities to tenants. Pursuant to A.R.S. § 33-1324(A)(2), Fisher’s Landing, Inc. had an obligation to maintain its rental property in a fit and habitable condition. It fulfilled that obligation by having Mr. Bush and another maintenance worker perform the electrical, sewer, water, and grading work described in the above Findings of Fact. 6. Fisher’s Landing, Inc. is not a contractor as defined by A.R.S. § 32- 1101(A)(3) because it was not specifically compensated for the work performed on the subject project. 7. The evidence of record established that Mr. Bush did not violate the provisions of A.R.S. § 32-1151, as charged by the Registrar in the civil citation issued to Mr. Bush. Mr. Bush is not a contractor as defined by A.R.S. § 32-1101(A)(3). Mr. Bush performed the maintenance work as an agent for the lessee and landlord, Fisher’s Landing, Inc., who is determined not to be required to be licensed as a contractor for the scope of work that its maintenance crew performed on the subject project. 8. Based on the foregoing, the civil citation issued to Mr. Bush should be dismissed and the Civil Penalty vacated. RECOMMENDED ORDER The civil citation issued to Mr. Bush and the Civil Penalty assessed to Mr. Bush by the Registrar in this matter shall be dismissed on the effective date of the Order entered in Case No. 2012-226. 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, May 21, 2012.

/s/ Brian Brendan Tully Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] The civil citation was issued to Mr. Bush. The Notice of Hearing on Citation and Civil Penalty issued by the Registrar lists “Charles Edward Bush/Fisher’s Landing, Inc” as Respondent. [2] That citation did not involve work performed by Mr. Bush as an agent for Fisher’s Landing, Inc.

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