ALJDEC decisions subject to certification as final

2015A-22-ROC · Registrar of Contractors · 2015-12-14

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: December 14, 2015, at 8:00 a.m. APPEARANCES: Kurt A. Scholz (“Complainant”) appeared telephonically on his own behalf; Patriots Remodeling LLC (“Respondent”) failed to appear. ADMINISTRATIVE LAW JUDGE: Diane Mihalsky _____________________________________________________________________

FINDINGS OF FACT On or about October 25, 2007, the Arizona Registrar of Contractors (“the Registrar”) issued License No. B-3.235206-R to Respondent. Respondent’s address of record is 101 2nd St., Huachuca City, Arizona 85616-9742. Peter Donald Shields (“Mr. Shields”) is Respondent’s managing member and qualifying party. On January 5, 2015, Complainant filed a complaint against Respondent with the Registrar alleging in nine specific items that Respondent had contracted to perform and had accepted payment of $3,322.89 for certain work at Complainant’s residence at 2364 Madera Drive, Sierra Vista, Arizona 85635 (“the residence”), but then had failed to perform any work whatsoever. The Registrar assigned Complainant’s complaint to its Investigator, Mike Nieves (“Investigator Nieves”) for investigation. On February 4, 2015, Investigator Nieves performed a jobsite inspection at the residence. On or about February 5, 2015, Investigator Nieves issued a Directive that confirmed that no work had been performed, but that noted that because Respondent’s license had been suspended for lack of bond, it could not perform or subcontract any work until the suspension was lifted. The Registrar issued a Citation against Respondent, charging cause to suspend, revoke, or otherwise penalize Respondent’s license under A.R.S. §§ 32-1154(A)(1) and 32-1154(A)(22). The Registrar mailed a copy of the Citation to Respondent at its address of record. Mr. Shields on behalf of Respondent filed a written answer to the Citation, acknowledging that Respondent had failed to perform any work at Complainant’s residence after accepting a deposit for the project. Mr. Shield stated that he had gotten really sick and that as a result, Respondent was no longer in business. The Registrar referred the matter to the Office of Administrative Hearings (“the OAH”), an independent agency, for an evidentiary hearing. On October 16, 2015, the Registrar issued a Notice of Hearing setting a hearing on December 14, 2015, at 8:00 a.m. in the OAH. The Registrar mailed a copy of the Notice of Hearing to Respondent at its address of record. Shortly before the scheduled hearing, Mr. Shields filed a letter with OAH, stating that he would not be attending the hearing. Complainant filed a packet of documents with the Registrar, which forwarded the documents to the OAH, including Complainant’s letter stating that he felt that it was imperative that he have the work completed and a letter from G A R Construction stating that it had completed the rebuild at Complainant’s residence. A hearing was held on December 14, 2015, at 8:00 a.m. Complainant, his wife, Laura Scholz (“Mrs. Scholz”), and Investigator Nieves testified. 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 twenty-one minutes to allow Respondent additional travel time, Respondent did not appear, through an authorized member, employee, or 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 to defend its license. Complainant testified that he and Mrs. Scholz purchased the residence from the City of Sierra Vista. At the time of the purchase, the residence had a carport that had been enclosed to become a bedroom. After Complainant and Mrs. Scholz later realized that the enclosure did not comply with code, the City of Sierra Vista paid an insurance settlement to Complainant and Mrs. Scholz to complete repairs. Complainant and Mrs. Scholz subsequently contracted with Respondent to correct the code violations and paid Respondent $3,322.89 as a deposit to begin the repairs. Although Complainant and Mrs. Scholz agreed that Respondent could wait until the end to the monsoon storms to perform the project, in October 2014, Mr. Shields or someone on his behalf left a voicemail or text for Complainant and Mrs. Scholz, stating that because Mr. Shields was ill, Respondent would not be performing any work on the job. Respondent did not ever return to do any work on the project at Complainant’s residence. Complainant testified that after Respondent abandoned the project, he felt that he needed to have someone complete the project because he feared that the City of Sierra Vista would charge him with insurance fraud if he did not correct the code violations after receiving money from the City to do so. Complainant testified that G A R Construction started the work in May 2015, and completed the work in June 2015. Mrs. Scholz testified that in addition, when it rained, water leaked into the enclosed carport, saturating the carpet. Repairs needed to be completed to prevent further damage and to reduce the risk of mold developing. Investigator Nieves testified that in his opinion, under the circumstances, Complainant and Mrs. Scholz were justified in hiring another contractor to perform the job. Administrative notice is taken of the Registrar’s public website, which shows that December 10, 2015, Respondent’s license had been suspended for lack of bond since October 8, 2014. / / / / CONCLUSIONS OF LAW 1. The administratively suspended status of Respondent’s license does not deprive Complainant of his right to prosecute his complaint against Respondent or prevent the Registrar from determining the merits of Complainant’s complaint.[1] This matter lies within the Registrar’s jurisdiction.[2] 2. The Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable and it appears that Respondent actually received notice of the hearing.[3] 3. Complainant bears the burden of proof to establish statutory violations by a preponderance of the evidence.[4] “A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.”[5] 4. Complainant established that Respondent violated A.R.S. § 32-1154(A)(1)[6] failing to perform any work after accepting the $3,322.89 deposit from Complainant. 5. Complainant also established that Respondent violated A.R.S. § 32-1154(A)(22) by failing to comply with the Registrar’s written directive.[7] RECOMMENDED ORDER Based on the foregoing, it is recommended that on the effective date of the final order in this matter, Respondent Patriots Remodeling LLC’s License No. B-3.235206-R be revoked. It is further recommended that the Registrar require Respondent to pay the sum of $250.00 as a civil penalty pursuant to A.R.S. § 32-1154(E).

It is further recommended that if Respondent fails to pay the entire amount of the civil penalty on or before thirty days following the effective date of the Registrar’s Order, the Registrar revoke Respondent’s license, 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, December 14, 2015.

/s/ Diane Mihalsky Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] See A.R.S. § 32-1154(D). That statute provides that “[t]he expiration, cancellation, suspension or revocation of a license . . . shall not deprive the registrar of jurisdiction to proceed with any investigation of or action or disciplinary proceeding against such license, or to render a decision suspending or revoking such a license . . . .” [2] See 32-1101 et seq. [3] See A.R.S. §§ 41-1092.04; 41-1092.05(D). [4] 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). [5] Morris K. Udall, Arizona Law of Evidence § 5 (1960). [6] A.R.S. § 32-1154(A)(1) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, “[a]bandonment of a contract or refusal to perform after submitting a bid on work without legal excuse for the abandonment or refusal.” [7] A.R.S. § 32-1154(A)(22) 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.”

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

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