ALJDEC decisions subject to certification as final

2016A-1820-ROC · Registrar of Contractors · 2016-09-06

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: September 1, 2016 APPEARANCES: Brandon Cheshire, founder of SunHarvest Solar and Electrical LLC, appeared on behalf of Complainant. No one appeared on behalf of GWGS, LLC. On August 31, 2016, counsel for Respondent, Thomas S. Moring, Esq. filed a Waiver of Appearance, noting solely that Respondent waived its appearance at hearing without providing an explanation for the nonappearance. ADMINISTRATIVE LAW JUDGE: Suzanne Marwil _____________________________________________________________________ FINDINGS OF FACT 1. GWGS LLC (Respondent) is the holder of License No. 280021 issued by the Registrar of Contractors (Registrar). 2. SunHarvest Solar and Electrical LLC (Complainant) filed a Complaint against Respondent with the Registrar alleging that Respondent had failed to pay Complainant the total sum of $19,093.84 for solar system installation work that was the subject of 16 different invoices dated March 15, 2016 through May 10, 2016. 3. The parties were unable to resolve their differences, and Complainant requested an administrative hearing. The Registrar then issued a formal Citation charging Respondent with a possible violation of A.R.S. § 32-1154(A)(10). 4. Respondent failed to appear at the time scheduled for hearing and through counsel waived its appearance in writing in advance of the hearing. Accordingly, the Administrative Law Judge conducted the hearing in Respondent’s absence. 5. Brandon Cheshire offered the only testimony in this matter. He indicated that Complainant had Respondent first began working together on August 14, 2013 with Complainant installing solar systems all over the state for Respondent at a fixed price per watt. He noted that the parties entered into a comprehensive Joint Installation and Service Agreement that expanded their relationship to the state of New Mexico and included collaborative sales efforts. 6. Madge characterized the parties’ relationship as good and transparent until March 15, 2016 when Respondent first failed to pay an invoice for $500.00. Relying on the parties’ past relationship, Complainant allowed Respondent to accrue a balance. 7. After several weeks of nonpayment, Cheshire emailed Respondent’s president and CEO to inquire about payment. On April 19, 2016, Appel responded that cash flow was limited but that Complainant will be paid. See Exhibit A. 8. On April 28, 2016, Kirby Hamby of Respondent noted that Respondent had paid Complainant $3,000.00 toward Respondent’s balance and were working on the rest. 9. On May 5, 2016, Appel again stated that Respondent would pay Complainant. See id. (“Brandon, I assure you this will be p[ai]d to you. We have never faulted in the past and have kept at least something coming to you.”) 10. During this time, Respondent continued to request that Complainant do work for it. See Exhibit B. 11. Complainant ceased taking new work for Respondent on May 10, 2016. 12. On May 11, 2016, Cheshire met with Respondent to discuss payment of the outstanding balance of $19,093.84. Cheshire said he was told that Respondent was restructuring itself as Sol-Up and had no intention of paying the outstanding balance. Cheshire recalled being advised to view the unpaid balance as an investment in the parties’ continued partnership. 13. Cheshire testified that he was never told of any workmanship issues concerning Complainant’s work or advised that Complainant had wrongfully retained an items as alleged in Respondent’s answer to the Complaint. 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. A.R.S. § 32-1154(A)(10) includes among the grounds for suspension, revocation, or other disciplinary action against a contractor’s license, [f]ailure by 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.

4. The evidence established Respondent had not made any payment toward the invoiced total of $19,093.84 since the Complaint was filed. 5. Respondent failed to establish that it lacked the ability to pay Complainant for the work performed. 6. Therefore, Complainant established that Respondent violated A.R.S. § 32-1154(A)(10) by failing to pay Complainant $19,093.84 for services rendered in connection with Respondent’s contracting business. 7. Based upon Respondent’s violation of the provisions of A.R.S. § 32- 1154(A)(10), grounds exist to impose discipline against Respondent’s license. RECOMMENDed order Based on the foregoing, it is recommended that the Registrar suspend GWGS LLC’s License No. 280021 issued by the Registrar until it has provided to the Registrar, and the Registrar has accepted, documents that establish that it has paid Complainant $19,093.84 in certified funds. It is further recommended that when and if the Registrar receives and accepts Respondent’s evidence that it has paid Complainant $19,093.84 in certified funds, the Registrar may close the Complaint in Case No. 2016- 1820. 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, September 6, 2016.

/s/ Suzanne Marwil Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors

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