ALJDEC decisions subject to certification as final

2017A-1713-CHC-ROC · Registrar of Contractors · 2017-08-29

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

John Blake,

COMPLAINANT,

v.

A & M Renovations LLC,

License No. CR61.300945-D,

RESPONDENT.

No. 2017A-1713-CHC-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: August 16, 2017, at 8:30 a.m.

APPEARANCES: John Blake (“Complainant”) appeared on his own behalf;

A & M Renovations LLC (“Respondent”) failed to appear.

ADMINISTRATIVE LAW JUDGE: Diane Mihalsky

_____________________________________________________________________

FINDINGS OF FACT

On or about September 15, 2015, the Arizona Registrar of Contractors (“the Registrar”) issued License No. CR61.300945-D for dual carpentry, remodeling and repair to Respondent. Respondent’s address of record is 9841 E. Sellarole Rd., Tucson, Arizona 85730-3017.

On or about March 29, 2017, Complainant filed a complaint with the Registrar alleging that Respondent had performed poor work and had abandoned a large remodeling project at Complainant’s home at 12400 East 8th St., Tucson, Arizona 85748. Complainant acknowledged in the complaint that he had hired other contractors to work on the job after he became frustrated with Respondent’s efforts and that on December 19 and 20, 2016, he had hired Porter Construction to complete the project.

According to the complaint, the amount of the parties’ contract was $60,825.00 and Complainant had paid Respondent $24,650.00 for its work on the contract. Complainant attached to the complaint Respondent’s July 28, 2016 estimate to perform various work for $58,987.50.

The Registrar assigned the complaint to its Investigator, Arlo Houston. Investigator Houston performed a jobsite inspection on April 21, 2017. Investigator Houston substantiated that the sheetrock in the ceilings of the laundry closet, the studio closet, the dining room, and the living room was not finished properly.

Investigator Houston’s Jobsite Inspection Notes indicate that he did not substantiate Complainant’s complaints about the tile floor, the front doors and laundry room doors, the electrical system throughout the house, the three-way switch in the studio, the can lights, the incomplete plumbing, loud clanking noises in the ductwork, the incomplete fireplace, the soundboard in the master bedroom, and the Ethernet cable because Respondent’s work on these items had been modified by others before the jobsite inspection. Investigator Houston also declined to substantiate some of Complainant’s complaints because they involved a financial dispute between the parties rather than workmanship.

On May 3, 2017, Investigator Houston sent a warning letter to Respondent, that stated in relevant part as follows:

It appears that you may have operated beyond the scope of your CR61 license. I reviewed evidence which suggested that you bid on, contracted for, or performed work that would require a B General Residential Contractor license.

Knowingly contracting beyond the scope of your license would be a violation of A.R.S. § 32-1154(A)(16). A violation of Section 32-1154(A)(16), if proved, would constitute grounds for the Registrar to suspend or revoke your license.

I recommend that you review the scope of your license. If you have questions about the scope of your license, a description of the scope can be found in rules R4-9-102, R4-9-103, or R4-9-104 of the Arizona Administrative Code. You can find those rules on the Registrar’s website at roc.az.gov.

On May 4, 2017, Investigator Houston issued a Directive to Respondent, requiring it to perform certain corrective work, in relevant part as follows:

“Sheetrock on ceiling never finished properly in living room and dining room.”

The Registrar has determined that any workmanship violations alleged in the complaint but not listed above are unsubstantiated and do not require corrective action.

The deadline for Respondent to perform the corrective work on the May 4, 2017 Directive was 5:00 p.m. on May 22, 2017.

On June 1, 2017, the Registrar issued a Citation, charging cause to revoke or suspend Respondent’s license under A.R.S. § 32-1154(A)(3), namely, A.A.C. R4-9-108, A.R.S. § 32-1154(A)(16), and A.R.S. § 32-1154(A)(22). The Registrar mailed the Citation to Respondent at its address of record.

Respondent filed a timely written answer to the Citation, stating that it did not abandon the contract because Complainant and his wife had asked Respondent to leave the project after they decided that Respondent was not completing the job quickly enough and that Complainant had hired another contractor to complete the project.

The Registrar referred the matter to the Office of Administrative Hearings (“the OAH”), an independent State agency, for an evidentiary hearing.

On June 27, 2017, the Registrar issued a Notice of Hearing, setting a videoconference hearing on August 16, 2017, at 8:30 a.m. at the Registrar’s Tucson office. The Notice of Hearing advised Respondent that “[f]ailure to attend the scheduled hearing is likely to result in an adverse ruling against you.” The Registrar sent a copy of the Notice of Hearing to Respondent at its address of record.

Although the start of the hearing was delayed fifteen minutes, Respondent did not request to appear telephonically, did not appear through an employee, member, or attorney, and did not contact the OAH to request a continuance or that the start of the hearing be further delayed. Consequently, Respondent did not present any evidence to defend its license.

A videoconference hearing was held, during which Complainant testified, presented the testimony of James Oien, License Number 204936, who repaired Respondent’s workmanship and substantially completed the project, and Jessica Welton Blake, Complainant’s wife, and submitted six exhibits. Investigator Houston also testified.

Investigator Houston testified consistently with his jobsite inspection notes and the May 4, 2017 directive. Investigator Houston testified that on May 22, 2017, after Complainant informed him that Respondent had not done anything to comply with the directive, he referred the matter to the Registrar’s Legal Department for issuance of the Citation.

Mr. Oien testified regarding Respondent’s numerous workmanship deficiencies that his company had repaired and/or completed.

Complainant submitted exhibits to establish the scope of work that Respondent contracted to perform in its estimates, the amounts paid to Respondent, and the amounts paid to other contractors to repair or complete Respondent’s work.

Pursuant to A.A.C. R4-9-117, administrative notice is taken of Respondent’s license history at the Registrar’s public website. As of this date, the license was current and in good standing. The Registrar has never before disciplined Respondent’s license and Complainant’s is apparently the only complaint pending against the license.

CONCLUSIONS OF LAW

Complainant’s complaints that Respondent performed poor work, contracted beyond the scope of its license, and failed to comply with the Registrar’s Directive lie within the Registrar’s jurisdiction.

The Notice of Hearing that the Registrar mailed to Respondent at its address of record was reasonable and it is deemed to have received notice of the hearing.

Complainant bears the burden of proof to establish that Respondent violated the charged provisions of A.R.S. § 32-1154(A) by a preponderance of the evidence.

“A preponderance of the evidence is such proof as convinces the trier of fact that the contention is more probably true than not.” A preponderance of the evidence is “[t]he 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.”

A.A.C. R4-9-104(B) provides that Respondent’s CR61 license for dual carpentry, remodeling, and repair allowed it to undertake “projects of $50,000 or less.” “‘Knowingly’ imports only a knowledge that the facts exist which bring the act or omission within the provisions of the statute using such word. It does not require any knowledge of the unlawfulness of the act or omission.” “‘Knowingly’ means, with respect conduct or circumstance described by a statute defining an offense, that a person is aware or believes that his or her conduct is of that nature or that the circumstance exists. It does not require any knowledge of the unlawfulness of the act or omission.” It has long been the law in Arizona and elsewhere that “‘[n]otice of facts and circumstances which would put a man of ordinary prudence and intelligence on inquiry is . . . equivalent to knowledge of all the facts a reasonably diligent inquiry would disclose.’”

As a licensed contractor, Respondent is deemed to know the scope of its license as set forth in A.A.C. R4-9-104(B). Respondent’s estimate in the amount of $58,987.50 that Complainant attached to the complaint establishes that Respondent knowingly contracted beyond the scope of its CR61 license. The record therefore contains grounds to suspend or revoke Respondent’s contractor’s license under A.R.S. § 32-1154(A)(16).

Construction is not a perfect art and, normally, a contractor must be afforded an opportunity to correct its work before the Registrar will suspend or revoke the contractor’s license. For this reason, the legislature has not empowered either the Office of Administrative Hearings or the Registrar to adjudicate or award money damages. Although Complainant may file a civil action against Respondent in a judicial forum to recover the cost of hiring Mr. Oien to repair or complete Respondent’s work and other consequential damages, such relief lies beyond the Registrar’s jurisdiction to award.

Complainant established that Respondent performed poor work on the sheetrock in the laundry closet, the studio closet, the dining room, and the living room, furnishing cause to revoke or suspend Respondent’s license under A.R.S. § 32-1154(A)(3), namely, A.A.C. R4-9-108.

Complainant established that Respondent failed to correct its poor work on the sheetrock in the dining room and the living room ceilings, furnishing cause to revoke or suspend Respondent’s license under A.R.S. § 32-1154(A)2-1154(A)(22).

RECOMMENDED ORDER

Based on the foregoing, it is recommended that on the effective date of the final order, Respondent A & M Renovations LLC’s License No. CR61.300945-D shall be suspended for one business day.

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, August 29, 2017.

/s/ Diane Mihalsky

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors