ALJDEC decisions subject to certification as final
2016A-4151-NPC-ROC · Registrar of Contractors · 2017-03-06
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Kay Construction Inc,
COMPLAINANT,
v.
Symmetry Construction LLC,
License No: 284265
RESPONDENT.
No. 2016A-4151-NPC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: January 30, 2017 with the record held open until February 13, 2017.
APPEARANCES: William Kay appeared on behalf of Complainant Kay Construction, Inc. Christopher L. Hering appeared on behalf of Respondent Symmetry Construction, LLC.
ADMINISTRATIVE LAW JUDGE: Velva Moses-Thompson
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FINDINGS OF FACT
1. On December 8, 2016, the Registrar of Contractors, (hereinafter “Registrar”) issued a Notice of Hearing setting the above captioned matter for hearing on January 30, 2017.
2. In November of 2015, Kay Construction, Inc., (hereinafter “Kay”), entered into a building construction contract with Symmetry Construction, LLC, (hereinafter “Symmetry”) for the “artHAUS” project.
3. The November 2015 contract provides, in relevant part, as following:
ARTICLE 6
CHANGES, CLAIMS AND DELAYS
CHANGES. When the Contractor so orders in writing, the Subcontractor, without nullifying this Subcontract Agreement, shall make any and all changes in the Subcontract Work which are within the general scope of this Subcontract Agreement (a “Subcontract Construction Change Directive).
Adjustments in the Subcontract Price or Subcontract Time, if any, resulting from such changes shall be set forth in a Subcontract Change Order pursuant to the Contract Documents.
No such adjustment shall be made for any changes performed by the Subcontractor that have not been ordered or approved by the Contractor in writing.
4. Kay began work on November 20, 2015. The work was completed on November 3, 2016.
5. In July of 2016, Jason Boysel, the qualifying party for Symmetry, met with William Kay, the owner of Kay, to discuss additional change orders submitted to Symmetry which were not a part of the original contract.
6. On October 19, 2016, the Registrar received a complaint filed by Kay against Symmetry for nonpayment in connection with the artHAUS construction project. In the complaint, Kay alleged that the contract was for $348,000 and that Symmetry had paid it $310,000. Kay alleged that Symmetry owed it an additional $49,000 for “extras”.
7. On November 15, 2016, the Registrar issued a citation alleging that Symmetry may have violated A.R.S. §32-1154(A)(10).
8. On November 30, 2016, Symmetry filed an answer to the citation denying Kay’s allegation that Symmetry owed Kay money.
9. At hearing, Mr. Kay contended that Symmetry agreed to pay for the change orders submitted in July 2016.
10. The July 2016 change orders were not signed as required by the November 2015 contract.
11. Mr. Kay testified that Mr. Boysel verbally agreed to pay for the change orders submitted in July of 2016. Mr. Kay testified that Mr. Boysel placed an asterisk on the line items that he agreed to pay.
12. At hearing, Mr. Boysel testified that he placed an asterisk on the line items which he generally understood and needed to review internally. Mr. Boysel requested an additional explanation for the items which were not marked with an asterisk. Mr. Boysel denied that he verbally agreed to pay for the items marked with an asterisk. 13. I find Mr. Boysel’s testimony to be credible.
14. At hearing, Mr. Kay initially denied that the signature on the conditional lien waiver on final payment submitted to Symmetry in July 2016 was his own. After Mr. Kay acknowledged his signature on other lien documents, Mr. Kay admitted that the signature on the conditional lien waiver on final payment submitted to Symmetry in July of 2016 was his own.
15. Kay submitted a payment application to Symmetry in July of 2016 seeking payment for its retention in the amount of $36,985.00. Kay also submitted a Conditional Waiver and Release on Final Payment that the final amount owing through July 31, 2016 was $36,985.00 and there were “0.00” in “disputed claims for extras.” See Exhibit 11, Page 3.
16. Kay submitted a June 2016 payment application for $1,440.00 due under the contract and executed a conditional lien waiver upon progress payment confirming that $1,440.00 was due through June 30, 2016. However, Kay asked Symmetry to pay for a recorded lien in the amount of $2,106.79 by one of Kay’s suppliers, 84 Lumber. Symmetry paid $2,106.79 to secure the release of the lien and retained the $1,440.00 sought by Kay in its June 2016 payment application, pursuant to the November 2015 contract.
17. Furthermore, Kay sought payment in its July 2016 invoices for “roof crickets” which had already been paid in the March 2016 payment application.
CONCLUSIONS OF LAW
A party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119.
A preponderance of the evidence is:
The greater weight of the evidence, not necessarily established by the greater number of witnesses testifying to a fact but by evidence that has the most convincing force; superior evidentiary weight that, though not sufficient to free the mind wholly from all reasonable doubt, is still sufficient to incline a fair and impartial mind to one side of the issue rather than the other.
Black’s Law Dictionary 1373 (10th ed. 2014).
Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011) (citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.").
“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).
The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).
Ariz. Rev. Stat section 32-1154(A) provides:
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:
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10. Failure by a licensee or agent or official of 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.
Kay failed to establish by a preponderance of the evidence that Symmetry failed to pay monies when due for materials and services rendered. Kay failed to establish that Symmetry agreed to pay for the July 2016 change orders. The evidence presented at hearing established that Symmetry paid Kay for the 84 Lumber lien.
The preponderance of the evidence does not show that Symmetry violated Ariz. Rev. Stat section 32-1154(A)(10) as alleged.
ORDER
IT IS ORDERED that the Citation and Complaint in Case No. 2016-4151 are dismissed.
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 is forty days after the date of that certification.
Done this day, March 6, 2017.
/s/ Velva Moses-Thompson
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors