ALJDEC decisions subject to certification as final

2017A-3710-CPA-ROC · Registrar of Contractors · 2018-01-30

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

IN THE MATTER OF THE CIVIL PENALTY CITATION ISSUED TO:

Eugene H Moreno

No. 2017A-3710-CPA-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: January 10, 2018, at 8:30 a.m.

APPEARANCES: Thomas Raine (“Mr. Raine” attorney for Registrar of Contractors “ROC” or “Registrar”) and Manuel Bermudez (“Investigator Bermudez” Investigator for the Registrar).

NON-APPEARANCE: Eugene H. Moreno

ADMINISTRATIVE LAW JUDGE: Linda Marie Brown

_____________________________________________________________________

Eugene H. Moreno (“Respondent”) requested a hearing pursuant to A.R.S. 41-1092, et seq., in response to a Cease and Desist and Civil Citation issued by the Registrar of Contractors (“Registrar”) for violations of engaging in contracting without a license and advertising without a license. The Registrar’s Exhibits 1 through 8 were admitted. Based on the evidence in this matter, the undersigned Administrative Law Judge recommends that the Registrar affirm the Cease and Desist Order and civil penalty issued to Respondent on September 11, 2017.

FINDINGS OF FACT

1. On or about July 20, 2017, the Registrar received a homeowner complaint alleging Respondent contracted without a license.

2. The Complainant alleged Respondent claimed he was licensed, bonded, insured and had a degree in horticulture. Complainant stated there was no written contract and no payments made to Respondent because there was a dispute on charges, and that Respondent filed a lawsuit against Complainant for payment.

3. Respondent filed a lawsuit against Complainant alleging in matter CV17017314 that “defendant owes me $1,030.00 for the following reasons: nonpayment for drip irrigation repair completed May 1, 2017.”

4. Upon receipt of the complaint, Debra Skow of Unlicensed Investigations in the Registrar’s office conducted a query search and found no records of active, inactive or pending license status or any previous unlicensed complaints regarding the Respondent.

5. The matter was assigned to Investigator Manual Bermudez. During his investigation, Investigator Bermudez noted in his report that on May 29, 2017, Eugene Moreno DBA Spanish Trail Landscaping contracted and advertised without a license by advertising his services on the internet and by agreeing to provide construction services to Complainant for $1,030.00. Mr. Moreno is not a licensed entity with the Registrar.

6. Investigator Bermudez noted that following documents were obtained to support Complainant’s allegation: formal complaint, internet advertisement, invoice, affidavit and state statutes and civil lawsuit information. He also made telephonic contact with the Complainant to ask how she became aware of Mr. Moreno, and made several attempts to telephonically contact Mr. Moreno but was unsuccessful.

7. Investigator Bermudez substantiated the allegations that Respondent was contracting and advertising without a license and issued a Cease and Desist Order and Civil Citation dated September 11, 2017, for committing the following offenses: A.R.S. § 32-1151 contracting without a license, and A.R.S. § 32-1165 advertising without a license. The civil penalty assessed was $2,500.00. The Cease and Desist Order was sent certified mail to Respondent at the following address: 480 West Eunice Place, Tucson, Arizona 85741-1408.

8. On or about October 13, 2017, Respondent sent a letter to the Registrar in response to the Cease and Desist Order stating, “I am not contracting or advertising.” He provided in his response information on how he came in contact with Complainant.

9. On November 1, 2017, the Registrar issued a Notice of Hearing, setting hearing on January 10, 2018, at 8:30 a.m. The Registrar mailed the Notice of Hearing to Respondent at its address in which the Cease and Desist Order was mailed, and to which, upon receipt, Respondent replied to the Registrar denying the allegations.

10. Respondent did not request to appear telephonically and did not request that the hearing be continued. Although the start of the duly noticed hearing was delayed twenty minutes to allow Respondent additional time to appear, 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 testimony or evidence at hearing.

TESTIMONY/EVIDENCE

11. At the hearing, Investigator Bermudez testified that he investigated the matter after the Registrar received a complaint from a homeowner.

12. Investigator Bermudez stated that he made several attempts to telephonically contact the Respondent but was unsuccessful. On the first violation of contracting without a license, Investigator Bermudez testified that a person may contract under the handyman exemption for less than $1,000.00. During his investigation, he found the Invoice provided to Complainant exceeded the statutory allowance, and that Respondent, by his own admission in the lawsuit he filed against Complainant, asserts he was performing contractor services that exceed the statutory allowance.

13. Investigator Bermudez further testified regarding the internet advertisement that a party may advertise but the advertisement must conspicuously disclose “not a licensed contractor.” In this instance, there was no such disclosure.

CONCLUSIONS OF LAW

The Notice of Hearing that the Registrar mailed to Respondent at its address in which the Respondent listed in his response to the Cease and Desist Order was reasonable and Respondent is deemed to have received notice of the hearing.

This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.

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. 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.

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.

Pursuant to A.R.S. § 32-1166, the Registrar of Contractors is authorized to issue cease and desist orders and to impose civil penalties up to $2,500.00 for each violation.

The evidence established a violation of Arizona contracting laws. As to the aggravating factors identified in A.A.C. R4-9-131, none of the aggravating factors are present in this matter. Thus, the total assessed civil penalty of $2,500.00 is not excessive in this circumstance. The Tribunal concludes that a civil penalty of $2,500.00 total is warranted in this case.

The uncontroverted evidence in this matter was that Respondent performed work for Complainant, invoiced her, and was advertising on the internet as provided in the screen shot provided by Complainant. It was also undisputed that Respondent is not a licensed contractor. Therefore, the weight of the evidence established that the Registrar of Contractors was authorized to issue its Cease and Desist Order in the amount of $2,500.00.

RECOMMENDED ORDER

Based upon the foregoing, it is recommended that the Registrar affirm the finding that Respondent violated A.R.S. § 32-1151 and A.R.S. § 32-1165, and assess a civil penalty of $2,500.00 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, January 30, 2018.

s/ Linda Marie Brown

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors