ALJDEC decisions subject to certification as final

2012A-907-ROC · Registrar of Contractors · 2012-07-31

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 18, 2012, at 1:00 p.m. APPEARANCES: Triple S Fence Company (hereinafter “Complainant”) appeared through its president and CEO, Dahn J. Smith. Maracay Construction LLC (hereinafter “Maracay”) appeared through its authorized representative, John Alexander Coleman. 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. Maracay is the holder of License No. B.172120-R issued by the Registrar of Contractors. 2. Complainant filed a Complaint against Maracay with the Registrar of Contractors alleging: (1) Maracay failed to pay Complainant for the completed block fence work for invoice nos. 206098 for $1,890.00, and 206129 for $425.00; and (2) Maracay failed to pay Complainant for the completed shared block wall side lines and block wall back lines as shown on invoice no. 206142 for $15,624.90. 3. Dahn J. Smith (hereinafter “Mr. Smith”) testified that Complainant closed its doors and approached Maracay for payment for the completed shared block wall side lines and block wall back lines constructed by Complainant. Mr. Smith acknowledged that Complainant’s contract with Maracay was a price-per-lot contract.[1] 4. Mr. Smith testified that Maracay owed Complainant $17,939.90. Mr. Smith stated that the total sum of $17,939.90 was for material and labor and did not include any penalties or interest.[2] 5. Mr. Smith stated that Maracay owed Complainant $15,624.90 based on the completed shared block wall side lines and block wall back lines in the Crescent View tract and the Palm Valley tract. Mr. Smith testified that Maracay owed Complainant $1,890.00 for the completed block wall work on Lot 7 in the Palm Valley tract and the sum of $425.00 for the repair of a damaged courtyard block wall on lot 112, in the Palm Valley tract.[3] 6. Mr. Smith testified that Complainant would make its profit at the end, or close out, of a housing tract when Complainant would be constructing “returns” or connecting block walls to existing block walls. Mr. Smith stated that Complainant was unable to make its expected profit for the Maracay tracts because Complainant closed its doors before the tracts closed out.[4] 7. Cassandra Lynn Carroll (hereinafter “Ms. Carroll”) testified that other general contractors had paid Complainant for the completed shared block wall side lines and block wall back lines that Complainant constructed in other housing tracts without objection. Ms. Carroll acknowledged that Complainant’s contract agreement with Maracay was based being paid on a per lot basis.[5] 8. John Alexander Coleman (hereinafter “Mr. Coleman”) testified that Maracay’s dispute on invoice no. 206098 for $1,890.00 and invoice no. 206129 for $425.00 was based on Maracay’s contractual right to withhold final payment to cover any warranty work that may have to be performed on Complainant’s block wall work. Mr. Coleman stated that Complainant has block walls under warranty with Maracay with warranty periods running from 25 days through 720 days.[6] 9. Mr. Coleman testified that Maracay was entitled to the retention based upon Section 17 of the parties’ written construction agreement.[7] Mr. Coleman stated that the warranty money would be released in full to Complainant at the end of the warranty period.[8] 10. Mr. Coleman testified that Complainant was not entitled to payment for anything for its claim set forth in invoice no. 206142 for $15,624.90 for the completed shared block wall side lines and block wall back lines because Maracay’s construction agreement with Complainant provided for payment on a per lot basis. Mr. Coleman stated that Complainant was fully paid the standard agreed-upon per lot price for each completed block wall.[9] 11. There was no dispute that Maracay corrected its Service Order documents and all other business documents to include its license number preceded by the acronym “ROC” in response to the Registrar of Contractors’ letter of February 21, 2012. 12. Maracay’s retention of the $1,890.00 set forth in invoice no. 206098 and the $425.00 set forth in invoice no. 206129 was shown to be based upon the parties’ written construction agreement for the lots at issue. 13. There was no dispute that Complainant had been fully paid for its completed construction work on the agreed-upon per lot basis as required by the parties’ written construction agreement. 14. There was no credible evidence that Maracay agreed to pay Complainant for the completed block wall side and back lines. CONCLUSIONS OF LAW 1. The burden of proof at an administrative hearing falls to the party asserting a claim, right, or entitlement and the standard of proof on all issues in these matters is by a preponderance of the evidence. See A.A.C. 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. There was no credible evidence that Maracay violated the charged provision of A.R.S. § 32-1154(A)(11).[10] 4. There was no dispute that Maracay has corrected its business forms to include its license number preceded by the acronym “ROC” in response to the Registrar of Contractors’ letter of February 21, 2012. This tribunal concludes that Maracay is now in compliance with the charged provision of A.R.S. § 32-1154(A)(13), namely A.R.S. § 32-1124(B).[11] RECOMMENDed order In view of the foregoing, it is recommended that this matter be dismissed on the effective date of the Registrar of Contractors’ Order.

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, July 31, 2012. /s/ M. Douglas Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors

----------------------- [1] 7/18/12 Hearing Record (hereinafter “H.R.”) at 17:07-20:45. [2] H.R. at 24:45-25:05. [3] H.R. at 26:04-28:15. [4] H.R. at 31:40-33:39. [5] H.R. at 36:33-39:31. [6] H.R. at 41;02-42:28. [7] See Exhibit No. R-5 (Palm Valley Subcontractor Agreement). [8] H.R. at 42:30-45:01. [9] H.R. at 42:02-49:09. [10] A.R.S. § 32-1154(A)(11) provides: Failure by a licensee or agent or official of a licensee 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. [11] A.R.S. § 32-1124(B) provides: Licenses issued under this chapter and any renewals shall be signed by the registrar or the registrar's designated representative and by the licensee. The license shall be nontransferable, and satisfactory evidence of possession shall be exhibited by the licensee upon demand. The license number appearing on any licenses held by the licensee shall be preceded by the acronym "ROC" and shall be posted in a conspicuous place on premises where any work is being performed, shall be placed on all written bids submitted by the licensee and shall be placed on all broadcast, published, internet or billboard advertising, letterheads and other documents used by the licensee to correspond with the licensee's customers or potential customers in the conduct of business regulated by this chapter. A violation of this subsection relating to posting and placement of license numbers shall be, at the discretion of the registrar, grounds for disciplinary action pursuant to section 32-1154, subsection A, paragraph 13, but not grounds for preventing the award of a contract, voiding an awarded contract, or any other claim or defense against the licensee. For the purposes of this subsection, advertising does not include a trade association directory listing that is distributed solely to the members of the association and not to the general public.

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