ALJDEC decisions subject to certification as final

2014A-2254-ROC · Registrar of Contractors · 2015-01-26

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: January 14, 2014, at 8:00 a.m. APPEARANCES: The Arizona Registrar of Contractors (“the Registrar”) was represented by Seth T. Hargraves, Esq., Assistant Attorney General; David R. Silverstein (“Respondent”) failed to appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT On or about May 23, 2014, one of the Registrar’s employees received a bid from Respondent to hang and tape twelve sheets of drywall. The amount of the bid, $3,200.00, was written on Respondent’s business card that also showed the company name, Advantage Drywall, and a list of construction services that Respondent was willing to perform. The complaint also included a printout from Advantage Drywall’s Facebook page.[1] Neither the business card nor the Facebook page included the disclaimer, “Not a licensed contractor.” The Registrar assigned the hotline tip to its criminal investigator, Johnnie Rodney Hamilton, to investigate. Investigator Hamilton consulted the Registrar’s records and found that neither Respondent nor his company had ever applied for or been issued a contractor’s license in Arizona. On or about September 16, 2014, Investigator Hamilton called Respondent at the telephone number on his business card. Investigator Hamilton identified himself and stated the reason for his call. After Investigator Hamilton asked Respondent if he was a licensed contractor, he stated that he was not, but that he had been in the process of obtaining a license for the last few months. Investigator Hamilton checked the Registrar’s records and did not find any evidence that Respondent or his company had ever applied for or was in the process of obtaining a contractor’s license. Investigator Hamilton asked Respondent if he were working under the so- called handyman’s exemption and Respondent stated that he was. Investigator Hamilton advised Respondent that the handyman exemption only allowed him to perform jobs having a value up to $999.00, including labor and materials, and required that he include the disclaimer, “Not a licensed contractor,” on all advertising used in his business. Investigator Hamilton subsequently located Respondent’s advertisement on Craigslist. It did not include the disclaimer, “Not a Licensed Contractor,” but did state that Respondent was “Unlicensed.”[2] On or about September 16, 2014, Investigator Hamilton on behalf of the Registrar issued a Cease & Desist Order, a Civil Citation, and imposed a civil penalty in the amount of $1,500.00 against Respondent for contracting without a license in violation of A.R.S. § 32-1151.[3] The Registrar served the document containing the Cease & Desist Order, Civil Citation, and notice of civil penalty on Respondent by registered mail at his address of record.[4] Respondent subsequently requested a hearing. In the request, Respondent claimed to have been working under the license of “Dominic and Son’s Inc.” and to have been working for Don Stankus. Respondent stated that he provided his own business card to the Registrar’s employee because he was out of Dominic and Son’s Inc.’s business cards.[5] The return address on Respondent’s request for hearing was the same as his address of record with the Registrar. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing. On November 5, 2014, the Registrar issued a Notice of Hearing on Citation and Civil Penalty. The Registrar mailed the Notice of Hearing on Citation and Civil Penalty to Respondent at his address of record. Respondent did not request to appear telephonically at the hearing and did not request that the hearing be continued. Although the start of the duly noticed hearing was delayed fifteen minutes to allow Respondent additional travel time, Respondent did not appear, personally or through attorney, and did not contact the OAH to request that the start of the hearing be further delayed. Consequently, Respondent did not present any evidence or make any argument in his own defense. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction.[6] The Notice of Hearing on Citation and Civil Penalty that the Registrar mailed to Respondent at his address of record was reasonable and Respondent is deemed to have received notice of the hearing.[7] The Registrar bears the burden of proof to establish Respondent’s statutory violation by a preponderance of the evidence.[8] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[9] A.R.S. § 32-1151 provides 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. . . .

A.R.S. § 32-1121(A)(14) sets forth the so-called “handyman’s exception” to licensure requirements for contractors who perform work whose aggregate contract price, including labor and materials, is less than $1,000.00 if other requirements are met. A.R.S. § 32-1121(A)(14)(c) provides that “[t]his exemption does not apply . . . [t]o a person who utilizes any form of advertising to the public in which the person's unlicensed status is not disclosed by including the words ‘not a licensed contractor’ in the advertisement.” A.R.S. § 32-1101(A)(3) defines “contractor” in relevant part as follows: "Contractor" is synonymous with the term "builder" and means any person . . . [who], 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:

(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.) The Registrar established that Respondent violated A.R.S. § 32-1151 by submitting a bid to hang and tape twelve sheets of drywall for the contract price of $3,200.00. A.R.S. § 32-1166(A) authorizes the Registrar to assess “a civil penalty in an amount of at least two hundred dollars for each violation but not more than two thousand five hundred dollars for the multiple violations committed on the same day.” The Registrar established that a civil penalty in the amount of $1,500.00 is appropriate for Respondent’s proven violation of A.R.S. § 32-1151. / / / / / / / / RECOMMENDED ORDER Based on the foregoing, it is recommended that the Registrar affirm the finding that Respondent David R. Silverstein violated A.R.S. § 32-1151 and affirm the decision to assess a civil penalty under A.R.S. § 32-1166(A) in the amount of $1,500.00, to be paid in certified funds to the Registrar on or before thirty days after the effective date of the final order in this matter. 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 five days from the date of that certification. Done this day, January 26, 2015.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See the Registrar’s Exhibit 1. [2] See the Registrar’s Exhibit 2 at 2 (Investigator Hamilton’s investigative report). [3] See the Registrar’s Exhibit 3. [4] See the Registrar’s Exhibit 3 at 3. [5] See the Registrar’s Exhibit 4. [6] See A.R.S. § 32-1101 et seq. [7] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [8] See A.R.S. § 41-1092.07(G)(3); A.A.C. R2-19-119(A) and A.A.C. R2-19- 119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [9] Morris K. Udall, Arizona Law of Evidence § 5 (1960).

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