ALJDEC decisions subject to certification as final

2014A-333-ROC · Registrar of Contractors · 2014-10-02

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: May 23, 2014 held open for post-hearing briefs and concluded as of August 15, 2014

APPEARANCES: Seth Hargraves, Assistant Attorney General representing the Registrar of Contractors; Antonio Bustamonte, Attorney for Respondent; Mark Candelaria, Respondent; Lawrence Matthews and David Gustafson, witnesses; Yolanda Pedrigo, observer

ADMINISTRATIVE LAW JUDGE: Dorinda M. Lang _____________________________________________________________________ On appeal from the denial of his application to the Registrar of Contractors for a plumbing license, the applicant has failed to establish that the denial was not appropriate. Therefore, it is recommended that the appeal be denied. FINDINGS OF FACT 1. On August 5, 2013, the Registrar of Contractors received an Application for Contractor’s License from University Plumbing, LLC (“Respondent”), an application for a K-37 Dual Plumbing license (Pending License No.: K-37.286875-D) that was submitted through Respondent’s qualifying party, Mark Candelaria (“Mr. Candelaria”). 2. Mr. Candelaria used an independent document preparation service to complete the application. Respondent disclosed in the application that Mr. Candelaria had been convicted of criminal trespass in 2007. The question relating to that information asked whether the applicant had been convicted of a felony or a misdemeanor or whether the applicant currently had any felony charges pending. The application informed applicants that they were required to answer “yes” even if a conviction had been “vacated, pardoned, expunged, dismissed, appealed, listed as undesignated or otherwise reduced or [whether the applicant’s] civil rights have been restored.” The application also informed applicants that providing false information is grounds for denial of the license. It also instructs them to use an extra sheet of paper to list the criminal history information if necessary. Exhibit 4. 3. Mr. Candelaria also completed a criminal background packet with an authorization to release criminal and other records. The packet asks the applicant to list all criminal incidents, providing space for three incidents in the form. Mr. Candelaria reported only one, criminal incident. The packet was received by the Registrar of Contractors Licensing Department on August 5, 2013, the same day it received the application. Exhibit 12. That same day, the Registrar of Contractors Licensing Department also received two Orders from the Tucson City Court and a Pima County Superior Court Minute Entry from Mr. Candelaria. The two orders and the minute entry indicated that guilty judgments were set aside but none of them indicated what charges were involved or the conviction dates. Exhibit 17. 4. The Registrar of Contractors’ ensuing background check revealed that Mr. Candelaria had been convicted of felony theft, two charges of misdemeanor 3rd degree criminal trespass, possession of drug paraphernalia, and failure to appear. Exhibit 14. It is noted that after Mr. Candelaria served his sentence for his convictions, the charges were set aside. Exhibit 15. 5. Based on the results of the application and criminal background check, the Registrar of Contractors denied Respondent’s application for failure to establish good character and reputation, failure to disclose a material fact, and conviction of a felony. Exhibit 1. 6. Respondent appealed the denial of the license application and a hearing was set to consider the appeal at the Office of Administrative Hearings. 7. At the hearing, Mr. Candelaria testified that he hired a company to complete the application for him. He said that he forgot to disclose some of the charges against him, but he did disclose charges that arose from the same incident, and this led the Registrar to discover the remaining charges. He said he forgot about the other charges because they were ultimately set aside by the court and/or they were so old that he didn’t think they were pertinent. He implied that the document preparation service told him not to worry about disclosing all of his records because the background check would reveal everything. He also said that he never doubted that all of his legal history would be revealed during the background check. 8. Mr. Candelaria testified that he has worked hard to set aside his convictions and rehabilitate himself. He said his family and the court has forgiven him and he wants the Registrar of Contractors to forgive him as well. 9. Lawrence Matthews, Chief of the Registrar of Contractors Licensing Department, testified that he reviews applications that pose a possibility of being denied. He said the Registrar of Contractors’ position on felonies is that there is no discretion because A.R.S. § 32- 1122(D) states that lack of good character can be established by showing that a person committed an act that would be grounds for suspension or revocation of a contractor’s license. 10. Mr. Matthews testified that the Registrar of Contractors’ position on misrepresentation is that it refers to any attempt not to provide all information requested in the application. He said full disclosure is important because the Registrar does not always get all the missing information in the background check and full disclosure is a means of seeing whether the applicant has good character. 11. Mr. Matthews testified that the Registrar of Contractors instituted a tool called the “Good Character Model” for applicants with criminal convictions to ensure equal treatment among applicants. Exhibit 14, last page. The tool calculates the appropriate response using points for various violations. Mr. Matthews testified that theft receives the most points because the Registrar takes the position that potential repeated acts of theft pose the highest risk to the public by contractors. Nevertheless, he personally reviewed the application and agreed that it should be denied. 12. Respondent argued that his failure to report the additional charges should not be considered a material misrepresentation because the information he disclosed led directly to the discovery of the unreported charges. Respondent argued that a misrepresentation is not material if a reasonable person would not attach importance to it, as established in some Arizona court cases. Considering that there was little space on the application to report additional criminal cases and the added insurance of a background check, Respondent took the position that it is not reasonable to find it is material to omit direct reporting of the applicant’s complete criminal history. The Registrar of Contractors argued that it is material because the application calls for full disclosure and warns the applicant that the application can be denied for failing to disclose. The Registrar of Contractors also argued that it is a sign of good character to fully disclose all criminal history, and that a background check may not reveal everything. It pointed out that the application states an applicant may use an additional sheet of paper to disclose their criminal history, so the argument that there was insufficient space to do so was not established. Additionally, it pointed out, the Criminal Records Disclosure form also offered additional space that Respondent did not use. 13. Respondent argued that a third party completed the paperwork. The Registrar of Contractors argued that Respondent was still responsible for its contents. 14. In response to Mr. Candelaria’s statement that he did not remember all of his convictions, the Registrar of Contractors argued that statements made by Mr. Candelaria at hearing implied that he did remember. 15. In response to Mr. Candelaria’s claim that the document preparation service led him to believe that full disclosure was not important, the Registrar of Contractors argued that this demonstrates a conscious decision not to disclose everything and that nowhere on the application does it indicate that less than full disclosure is acceptable. 16. In response to Mr. Candelaria’s statement that he provided the Registrar of Contractors with enough information to discover his criminal history on their own, the Registrar of Contractors argued that it was Respondent’s responsibility to establish good character and not the Registrar of Contractors’ responsibility to go out and find information for the applicant. Further, the few court documents that Respondent did provide did not include the information requested in the application about those cases, such as the conviction date and the charge. Further, it noted, Respondent provided no information at all on two of Mr. Candelaria’s criminal cases in the application or background check packet. 17. Respondent argued that it is inappropriate to deny an application for having a felony conviction because the applicable Arizona Revised Statute, A.R.S. § 32-1154(A)(8) states that it is a violation for a licensee to commit a felony, but it does not state that former felons cannot receive a license. The Registrar of Contractors maintained that a felony is grounds to deny an application, and, noting the particular facts of one of Mr. Candelaria’s crimes, argued, in effect, that it was appropriate in this case to do so.[1] 18. Regarding the denial for failure to establish good character pursuant to A.R.S. 32-1122(D), Respondent argued that this issue is discretionary. The Registrar of Contractors did not specifically dispute this point but argued that the denial was appropriate in this case. 19. Respondent argued that the Registrar was arbitrary and capricious in utilizing a formula to arrive at its decision to deny the application because there is no statutory foundation for its use or application and it does not reflect Mr. Candelaria’s merits as a former cocaine addict who has overcome the addiction that was the driving force behind his criminal history.[2] CONCLUSIONS OF LAW 1. This matter is within the jurisdiction of the Registrar of Contractors pursuant to A.R.S. §§ 32-1104(A)(4), 32-1154(B) and 32-1156. 2. Respondent has the burden of proof in this matter, and the standard of proof is a preponderance of the evidence. See A.R.S. § 41- 1092.07(G); A.A.C. R2-19-119. 3. In this case, Respondent has failed to establish that the application was improperly denied because Respondent has not established that its qualifying party, Mr. Candelaria, is of good character and reputation. 4. Arizona law provides as follows: To obtain or renew a license under this chapter, each person shall be of good character and reputation. Lack of good character and reputation may be established by showing that a person has engaged in contracting without a license or committed any act that, if committed or done by any licensed contractor, would be grounds for suspension or revocation of a contractor's license or by showing that the person was named on a contractor's license that was suspended or revoked in another state. A.R.S. § 32-1122(D) 5. Arizona law provides the following grounds for suspension or revocation of a contractor’s license:

Grounds for suspension or revocation of license; continuing jurisdiction; civil penalty; recovery fund award; summary suspension A. The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions: * * * 6. Misrepresentation of a material fact by the applicant in obtaining a license. * * * 8. Conviction of a felony. * * * 13. Failure in any material respect to comply with this chapter. A.R.S. § 32-1154. [3] 6. Respondent correctly identified that A.R.S. § 32-1122(D) contains discretionary language. However, even with the liberal application of discretion, it is not appropriate to find that Mr. Candelaria has offered sufficient evidence to show that he is of good character and reputation. He might have started to do so by fully disclosing all of his criminal history. Given the initial opportunity to display his good character by disclosing every bit of his criminal history, he declined. 7. Mr. Candelaria’s claim that he did not remember his criminal past does not excuse his failure to report it because the application does not request only the history that one can remember just then. It is hard to believe that with some quiet reflection anyone could not remember their full criminal history.[4] Further, the story revealed by Mr. Candelaria at hearing (Hearing Audio at 51:45 to 1:03:40) shows that several of the crimes were interrelated, making it extremely unlikely that Mr. Candelaria was left with the impression that he had only been charged with one crime, and unlikely that he didn’t remember all of his charges, or at least several more of them than he reported. His remaining excuses for failure to disclose his full history were similarly unconvincing. The idea that, because there is a background check, Mr. Candelaria is not required to disclose everything is a flippant assumption and in choosing to adopt this position, Mr. Candelaria took his chances. However, even if he had disclosed all of his criminal history, Mr. Candelaria still did not establish good character and reputation. 8. It is not sufficient to avoid criminal conviction for a number of years following charges for several felonies and imprisonment. Considering that he experienced being charged, going to jail, and drug problems, it is especially important for Mr. Candelaria to establish a course of redemption. However, other than stating that he has worked hard and stayed clean, Mr. Candelaria offered no documentary evidence or character witness testimony to establish that he is no longer using drugs, that he has changed his life, that he has earned someone’s trust over a period of time, or any other outward sign of growth, recovery, or improvement. Although he claimed to have taken many personal growth courses in prison, he declined to offer any documentary evidence of it. In fact, he stated he threw away his prison course records and implied that he felt it would be a waste of time to try to obtain it through the prison due to a vague impression that no records would have been kept. Hearing Audio at 1:05:00 to 1:05:59. He offered no objective evidence to show that his impression of the prison’s ineptitude at record keeping was accurate. In sum, Respondent did not establish that, having failed to function once under the pressure of having a previous plumbing license, Mr. Candelaria would not succumb to the same pressures because he did not offer any evidence to show that he has gained the skills he needs to function under pressure and that he is now able to rise to the occasion. 9. Since Mr. Candelaria has not met his burden of proof with regard to good character and reputation, it is not necessary to make a determination on the dispository nature of a felony conviction or an application misrepresentation. The Administrative Law Judge concludes that the evidence as a whole did not demonstrate that Mr. Candelaria meets the criteria required for licensure at this time. RECOMMENDED DECISION Based upon the foregoing considerations, it is hereby recommended that this appeal be denied. Respondent’s application under Pending License No.: K-37.286875-D was properly denied.

If the Director of the Office of Administrative Hearings certifies this Administrative Law Judge Decision, the effective date of the order will be forty (40) days from the date of certification.

Done this day, October 2, 2014.

/s/ Dorinda M. Lang Administrative Law Judge

Transmitted electronically to:

William A. Mundell, Director Registrar of Contractors ----------------------- [1] The Registrar of Contractors’ argument specifically noted that Mr. Candelaria, having held a K-36 Plumbing license for four months, found the pressure of contracting added to a devastating cocaine addiction (Hearing Audio at 1:05:55 to 1:06:40) that led to his plan to rent tools from Home Depot using a blank check from an account without any funds, tools which he then pawned so that he could put graphics on his van for his plumbing business. Hearing Audio at 51:45 to 56:00. “Since, by his own admissions, having a contractor license turns him into a spiraling drug addict and a thief, how is the public protected by him obtaining a new contractor license? Especially, since he has failed to demonstrate any treatment or rehabilitation from his drug addiction.” State’s Closing Argument, pages 8- 9, July 22, 2014. [2] Respondent’s Written Closing Argument, pages 5-6, June 23, 2014, and Reply to State’s Closing Argument, pages 4-5, September 16, 2014. [3] Currently renumbered as A.R.S. § 32-1154(A)(5), (7), and (12). [4] The Registrar of Contractors made several astute observations on the contradictory nature of Mr. Candelaria’s claims, mounting an effective challenge to his overall credibility. State’s Closing Argument, pages 5-7, June 23, 2014.

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