ALJDEC decisions subject to certification as final

2014A-2312-ROC · Registrar of Contractors · 2014-09-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 10, 2014, at 8:00 a.m. APPEARANCES: The Arizona Registrar of Contractors (“the Registrar”) was represented by Seth T. Hargraves, Esq., Assistant Attorney General; Metal Pros LLC (“Respondent”) failed to appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT 1. On September 9, 2007, the Registrar issued License No. C- 42.237548-R to Respondent, an Arizona limited liability company.[1] Respondent’s current address of record is 6262 E. Glencove Circle #1, Mesa, Arizona 85205. 2. On November 4, 2013, the Registrar suspended Respondent’s license for lack of bond and on February 12, 2014, the Registrar lifted the suspension.[2] Respondent’s license is currently on disciplinary probation. 3. On or about January 16, 2014, Joan Bahamonde filed a complaint with the Registrar alleging poor work by Respondent in its performance of its November 23, 2013 contract to replace the roof of Ms. Bahamonde’s residence located at 536 East Erie Drive in Tempe, Arizona for $35,680.00.[3] Ms. Bahamonde attached to her complaint a copy of Respondent’s November 22, 2013 proposal, which became the parties’ contract when she accepted it.[4] 4. The specific items of Ms. Bahamonde’s complaint included that she and her husband had requested a standing seam metal roof, that Respondent had furnished a sample of a 24-gauge striated metal roof for their approval, and that they had approved the sample for Respondent to install.[5] When Respondent installed the new roof, however, it installed an inferior product that lacked striations. 5. Ms. Bahamonde’s complaint was assigned to the Registrar’s Investigator Ted Gerold. On February 6, 2014, Investigator Gerold conducted a jobsite inspection. Investigator Gerold’s Jobsite Inspection Notes stated that the sample that Respondent left with Ms. Bahamonde “[had] striations which make the metal roofing far more rigid than what was installed on the roof. The metal installed on the roof [has] no striations which cause dimples throughout, known in the industry as ‘oil canning.’”[6] 6. On February 25, 2014, Investigator Gerold on behalf of the Registrar issued a Directive that ordered Respondent to “[c]omplete metal roofing project using materials that match the striated sample left at Complainant’s residence” and to provide satisfactory written proof of its compliance with the Directive on or before March 18, 2014.[7] 7. Respondent did not provide any written proof that it had complied with the Registrar’s February 25, 2014 Directive. 8. On June 19, 2014, staff attorney Jose Gill, on the Registrar’s behalf, issued a Citation and Complaint against Respondent, charging violations of A.R.S. § 32-1154(A)(2), A.R.S. § 32- 1154(A)(13), namely A.R.S. § 32-1158(B), A.R.S. § 32-1154(A)(16), A.R.S. § 32-1154(A)(18), and A.R.S. § 32-1154(A)(23).[8] The Registrar sent the Citation and Complaint to Respondent at its address of record. 9. On July 9, 2014, Respondent filed a written answer to the Citation and Complaint. Respondent acknowledged that the metal roofing samples that were shown to Ms. Bahamonde were striated and asserted that Respondent would complete installation of the striated metal roof.[9] 10. The Registrar referred the matter to the Office of Administrative Hearings (“OAH”), an independent state agency, for an evidentiary hearing. On July 22, 2014, the Registrar issued a Notice of Hearing, setting a hearing on September 10, 2014, at 8:00 a.m. before OAH. The Registrar mailed the Notice of Hearing to Respondent at its address of record. 11. 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 to allow Respondent additional travel time and the hearing did not conclude until approximately 9:00 a.m., Respondent did not appear, through an authorized member, employee, or attorney, and did not contact OAH to request that the start of the hearing be further delayed. Consequently, Respondent did not present any evidence to defend its license. 12. The Registrar presented the testimony of Ms. Bahamonde and Mr. Gill and submitted seven exhibits. 13. Ms. Bahamonde testified that Respondent had used a “bait-and- switch” sales tactic by enticing her to enter into the contract with a sample of striated metal roofing, then installing inferior, less expensive roofing that lacked striations. 14. Ms. Bahamonde testified that after Investigator Gerold issued the February 25, 2014 Directive, although Respondent made promises, met with her, sent emails, and sent out a crew, which did not stay at her house very long, Respondent did not complete installation of the roof using materials that matched the striated sample that it had left with Ms. Bahamonde. 15. Mr. Gill noted that when Respondent submitted its proposal to install a new metal roof on Ms. Bahamonde’s house, when she accepted the proposal, and when Respondent started performing the work to install the roof, Respondent’s license was suspended, in violation of A.R.S. § 32-1154(A)(18). 16. Mr. Gill testified that Respondent’s contract with Ms. Bahamonde lacked two elements that A.R.S. § 32-1158(B) required in any contract in an amount of more than $1,000.00 entered into between a contractor and the owner of a property to be improved: (1) A completion date, required by A.R.S. § 32-1158(B)(4); and (2) Notice to the property owner of her right to file a complaint with the Registrar for an alleged violation of A.R.S. § 32- 1154(A), along with the Registrar’s telephone number and website address and a statement that complaints must be filed in the time allowed by A.R.S. § 32-1155(A). 17. Mr. Gill testified that Respondent violated A.R.S. § 32- 1154(A)(2) by contracting to install striated metal roofing that would have made the roofing more rigid and secure, then installing metal roofing without striations. 18. Mr. Gill testified that Investigator Gerold reviewed the roofing samples that Respondent had provided to Ms. Bahamonde to entice her to enter into the contract. Mr. Gill explained that the Registrar defines false advertising under A.R.S. § 32-1154(A)(16) to include oral solicitations. 19. Mr. Gill pointed out that not only had Ms. Bahamonde testified that Respondent did not complete installation of the striated roof, Respondent acknowledged in its written answer that it had not yet completed such installation, in violation of A.R.S. § 32- 1154(A)(23). CONCLUSIONS OF LAW 1. The Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable, and it is deemed to have received notice of the hearing.[10] 2. The Registrar bears the burden of proof to establish cause to discipline Respondent’s license under the statutes charged in the Citation and Complaint by a preponderance of the evidence.[11] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[12] 3. The Registrar established cause to discipline Respondent’s license under A.R.S. § 32-1154(A)(2),[13] A.R.S. § 32- 1154(A)(13),[14] namely A.R.S. § 32-1154(B)(4) and (9),[15] A.R.S. § 32-1154(A)(16),[16] A.R.S. § 32-1154(A)(18),[17] and A.R.S. § 32-1154(A)(23).[18] RECOMMENDED ORDER In light of the foregoing, IT IS ORDERED that on the effective date of this order, License No. C-42.237548-R of Respondent Metal Pros, LLC is revoked. IT IS FURTHER ORDERED that Respondent shall pay the sum of $500.00 as a civil penalty pursuant to A.R.S. § 32-1154(D) for its proven violation of A.R.S. § 32-1154(A)(23). IT IS FURTHER ORDERED that Respondent shall pay the sum of $1,000.00 as a civil penalty pursuant to A.R.S. § 32-1154(E) for its proven violation of A.R.S. § 32-1154(A)(18). IT IS FURTHER ORDERED that if Respondent fails to pay the entire amounts of both civil penalties on or before thirty days following the effective date of this Order, Respondent’s license shall be revoked, effective on such deadline date. No future license shall be issued to any entity consisting of persons associated with Respondent, as defined in A.R.S. § 32-1101(A)(5), unless Respondent tenders payment of any outstanding prior civil penalty. 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, September 29, 2014.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] See the Registrar’s Exhibit 1 at 1-5 (Respondent’s application and license). [2] See the Registrar’s Exhibit 1 at 6 (license printout). [3] See the Registrar’s Exhibit 2. [4] See id. at 3. [5] See id. at 6. [6] The Registrar’s Exhibit 4. [7] The Registrar’s Exhibit 5. [8] See the Registrar’s Exhibit 6. [9] See the Registrar’s Exhibit 7. [10] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [11] See A.R.S. § 41-1092.07(G)(2); A.A.C. R2-19-119; see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). [12] Morris K. Udall, Arizona Law of Evidence § 5 (1960).

[13] A.R.S. § 32-1154(A)(2) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[d]eparture from or disregard of plans or specifications . . . in any material respect which is prejudicial to another without consent of the owner or the owner’s duly authorized representative and without the consent of the person entitled to have the particular construction project or operation completed in accordance with such plans and specifications and code.” [14] 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.” In the time since Respondent committed that acts that supported the charges, A.R.S. § 32-1154(A)(13) was renumbered as A.R.S. § 32-1154(A)(12). [15] A.R.S. § 32-1158(B) provides that any contract in an amount of more than one thousand dollars entered into between a contractor and the owner of a property to be improved after December 31, 2007 must be in writing and must include certain minimum terms, including the following:

4. The estimated date of completion of all work to be performed under the contract. . . . .

9. That the property owner has the right to file a written complaint with the registrar for an alleged violation of section 32-1154, subsection A. The contract shall contain the registrar’s telephone number and website address and shall state that complaints must be made within the applicable time period as set forth in section 32-1155, subsection A. The information in this paragraph must be prominently displayed in the contract in ten point bold type. . . .

[16] A.R.S. § 32-1154(A)(16) includes among the grounds for suspension, revocation, and other disciplinary action against a contractor’s license, “[f]alse, misleading or deceptive advertising whereby any member of the public may be misled and injured.” In the time since Respondent committed that acts that formed the basis of the charges, A.R.S. § 32-1154(A)(16) was renumbered as A.R.S. § 32-1154(A)(15). [17] A.R.S. § 32-1154(A)(18) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[c]ontracting or offering to contract or submitting a bid while the license is under suspension or while the license is on inactive status.” In the time since Respondent committed that acts that supported the charges, A.R.S. § 32-1154(A)(18) was renumbered as A.R.S. § 32-1154(A)(17). [18] A.R.S. § 32-1154(A)(23) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[f]ailure to take appropriate corrective action to comply with this chapter or with rules adopted pursuant to this chapter without valid justification within a reasonable period of time after receiving a written directive from the registrar.” In the time since Respondent committed that acts that supported the charges, A.R.S. § 32-1154(A)(23) was renumbered as A.R.S. § 32-1154(A)(22).

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

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