ALJDEC decisions subject to certification as final

2016A-97-ROC · Registrar of Contractors · 2016-08-03

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: July 14, 2016 APPEARANCES: The Registrar of Contractors was represented by Assistant Attorney General Thomas Raine. Respondent Stephen Lee Walker did not appear. ADMINISTRATIVE LAW JUDGE: Tammy L. Eigenheer _____________________________________________________________________ Respondent appealed a Civil Citation issued by the Registrar of Contractors (Registrar) for contracting without a license. The Civil Citation imposed a civil penalty in the amount of $1,500.00. Evidence and testimony were presented and the following Findings of Fact, Conclusions of Law, and Recommend Order are made, finding a violation and recommending assessment of a $1,500.00 civil penalty. FINDINGS OF FACT Respondent is not a licensed contractor in the State of Arizona. On or about August 31, 2015, the Registrar received a complaint from Thomas Helling regarding Stephen Lee Walker (Respondent). The complaint alleged that Respondent entered into a contract to build a block wall around a mobile home for $5,570.00, failed to complete the work, and the work done did not meet minimum workmanship standards. On or about January 5, 2016, Investigator James Vildusea contacted Mr. Helling regarding the complaint. Mr. Helling stated that he was remodeling the interior of a mobile home for Mrs. Ferns and Respondent was reskirting around the home with the installation of the masonry wall. Mr. Helling stated that he observed poor work done by Respondent and that the work was not completed. Mr. Helling stated he filed the complaint on behalf of Mrs. Ferns. On or about January 5, 2016, Investigator Vildusea contacted Mrs. Ferns. Mrs. Ferns stated that Respondent told her that he was a licensed contractor and had been licensed for several years. Mrs. Ferns agreed to pay Respondent $5,170.00 for the work. Mrs. Ferns paid $4,985.00 toward the contract. Investigator Vildusea testified that Arizona contracting law allows an exemption from licensure, with certain limitations, for a “handyman.”[1] Investigator Vildusea stated that Respondent’s work did not fit within the handyman exemption because it exceeded the $1,000.00 limit. Investigator Vildusea determined that Respondent had violated the provisions of A.R.S. § 32-1151 (Engaging in contracting without a license). A Cease & Desist Order was sent via certified mail to Respondent on January 11, 2016, for violating the provisions of A.R.S. § 32-1151. A total of $1,500.00 in civil penalties was assessed. Respondent signed for the certified mailing. On or about February 24, 2016, the Registrar issued a Notice of Hearing on Citation and Civil Penalty to Respondent at the same address to which the Cease & Desist Order was sent. CONCLUSIONS OF LAW This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq. The copy of the Notice of Hearing on Citation and Civil Penalty that the Registrar mailed to Respondent at his address of record was reasonable and Respondent is deemed to have received notice of the hearing. A.R.S. §§ 41- 1092.04 and 41-1092.05(D). The Registrar bears the burden of proof to establish Respondent’s statutory violations by a preponderance of the evidence. See A.R.S. § 41- 1092.07(G)(2); A.A.C. R2-19-119(A); and A.A.C. R2-19-119(B)(1); see also Vazanno v. Superior Court, 74 Ariz. 369, 372, 249 P.2d 837 (1952). “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). Arizona contracting law prohibits a person from acting as a contractor without a license.[2] The Registrar can order a person who performs contracting without a license and who is not exempt from licensure to cease and desist such activity and may impose a civil penalty of between $200.00 and $2,500.00 for each violation, but not more than $2,500.00 per day.[3] A.R.S. § 32-1151 provides as follows: It is unlawful for any person, firm, partnership, corporation, association or other organization, or a combination of any of them, to engage in the business of, submit a bid or respond to a request for qualification or a request for proposals for construction services as, act or offer to act in the capacity of or purport to have the capacity of a contractor without having a contractor's license in good standing in the name of the person, firm, partnership, corporation, association or other organization as provided in this chapter, unless the person, firm, partnership, corporation, association or other organization is exempt as provided in this chapter. Evidence of securing a permit from a governmental agency or the employment of a person on a construction project shall be accepted in any court as prima facie evidence of existence of a contract.

A.R.S. § 32-1165 provides as follows: Except as authorized by section 32-1121, subsection A, paragraph 14, subdivision (c), it is a class 1 misdemeanor for any person to advertise that he is able to perform any service or contract for compensation subject to regulation by the registrar under the terms of this chapter unless a license under the terms of this chapter is first obtained regardless of whether his operations as a contractor are otherwise exempt.

A.R.S. § 32-1166(A) authorizes the Registrar to assess “a civil penalty in an amount of at least two hundred dollars for each violation but not more than two thousand five hundred dollars for the multiple violations committed on the same day.” With respect to the appropriate amount of civil penalties for violations of A.R.S. § 32-1151, A.R.S. § 32-1166(A) required the Registrar to “adopt rules covering the assessment of a civil penalty that give due consideration to the gravity of the violation and any history of previous violations.” Pursuant to this directive, the Registrar adopted A.A.C. R4-9-131.[4] The evidence established a violation of Arizona contracting laws. As to the aggravating factors identified in A.A.C. R4-9-131, Respondent represented to Mrs. Ferns and Mr. Helling that he was a licensed contractor. Respondent did not complete the job in question, and the work he did perform did not meet the minimum workmanship standards. Thus, the assessed civil penalty of $1,500.00 is warranted. RECOMMENDED ORDER Based upon the foregoing, it is recommended that the Registrar affirm the finding that Respondent violated A.R.S. § 32-1151, and assess a civil penalty of $1,500.00 to be paid in certified funds to the Registrar on or before the effective date of the Registrar’s final Order in this matter. 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 shall be forty (40) days from the date of certification. Done this day, August 3, 2016.

/s/ Tammy L. Eigenheer Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director Registrar of Contractors ----------------------- [1] See A.R.S. § 32-1121(A)(14). [2] A.R.S. § 32-1164(A)(2). It is noted that Investigator Bermudez testified to a $500.00 minimum civil penalty per violation; however, that testimony is inconsistent with the statute. [3] A.R.S. § 32-1166(A). [4] A.A.C. R4-9-131 sets forth permissible aggravating factors to be considered, in relevant part as follows:

In assessing a civil penalty as provided for under A.R.S. § 32- 1166(A), the Registrar shall give due consideration to whether the person cited or any individual acting on that person’s behalf has committed one or more of the following acts in determining the gravity of the cited violation: 1. Falsely represented to be a licensed contractor. 2. Failed to perform any work for which money was received. 3. Executed or used any false or misleading documents for the purpose of inducing a person to enter into a contract or to pay money for work to be performed. 4. Made false or misleading statements for the purpose of inducing a person to enter into a contract or to pay money for work to be performed. 5. Failed or neglected to apply funds which were received for the purpose of obtaining or paying for services, labor, materials, or equipment. 6. Performed work that was or had the potential to become hazardous to the health, safety, or general welfare of the public. 7. Performed work that deliberately was in violation of building codes, safety laws, labor laws, workers’ compensation laws, or unemployment insurance laws. 8. Performed work that failed to meet minimum acceptable trade or industry standards or practices or was not performed in a good and workmanlike manner. 9. Has committed any other act which would otherwise be cause for disciplinary action if the person cited had been properly licensed pursuant to A.R.S. Title 32, Chapter 10. 10. Has committed two or more prior violations. 11. Performed work that has caused loss or damage to the structure, its appurtenances, or property being worked upon or has caused loss or injury to any person.

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