ALJDEC decisions subject to certification as final

2017A-441-CPA-ROC · Registrar of Contractors · 2017-07-17

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

Registrar of Contractors,

IN THE MATTER OF THE

CIVIL PENALTY CITATION ISSUED TO:

Norman Yancovich

No. 2017A-441-CPA-ROC

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: May 15, 2017 and July 11, 2017

APPEARANCES: Norman Yancovich (hereinafter “Mr. Yancovich” or “Respondent”) appeared in person at the first hearing, which was continued based on his request to attempt to settle this matter. Mr. Yancovich did not appear at the hearing that was rescheduled after he failed to comply with the conditions of the proposed settlement. The Arizona Registrar of Contractors (hereinafter “Registrar”) was represented by Assistant Attorney General Thomas Raine.

ADMINISTRATIVE LAW JUDGE: Suzanne Marwil

_____________________________________________________________________

Mr. Yancovich appealed a Civil Citation issued by the Registrar for contracting without a license. The Civil Citation imposed a penalty 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 imposition of a total of $1,500.00 in civil penalties.

FINDINGS OF FACT

Background and Procedure

Mr. Cushing is not a licensed contractor in the State of Arizona.

On or about January 19, 2017, the Registrar received a complaint from Ellen Arkin (hereinafter “Ms. Arkin”) alleging that Respondent had verbally contracted to perform the installation of a fireplace at her home located at 4502 North Harwick Drive, Prescott Valley, Arizona 86314, assisted her in obtaining a permit for the work that he acknowledged was required by the town of Prescott Valley, and was paid $600.00 for the work, which ultimately had to be redone because it could not pass inspection. See Exhibit 3 at page 2.

The Registrar’s Investigator, Daniel Oen (hereinafter “Investigator Oen”), initiated an investigation of the complaint.

Investigator Oen testified that during the course of the investigation he met with Ms. Arkin and spoke to Mr. Yancovich via telephone. Ms. Arkin told Investigator Oen that Mr. Yancovich had done some small jobs for her in the past and convinced her he was the “best”. Exhibit 2 at 3. According to Ms. Arkin, Mr. Yancovich damaged the fireplace and she had to hire another contractor to replace the fireplace insert.

On February 15, 2017, Mr. Yancovich admitted during a conversation with Investigator Oen that he had agreed to do the work of installing the gas line and fireplace for an hourly rate. Exhibit 2 at 4. Mr. Yancovich acknowledged that he went with Ms. Arkin to get permits for the work in question. Id. Mr. Yancovich told Mr. Oen that he had recently learned that as an unlicensed contractor, he could not do work if a homeowner pulled an owner building permit. Id.

Investigator Oen determined that Mr. Yancovich had violated the provisions of A.R.S. § 32-1151 (Engaging in contracting without a license). A Cease & Desist Order was issued to Mr. Yancovich for violating the provisions of A.R.S. § 32-1151. A total of $1,500.00 in civil penalties was assessed for one count of contracting without a license Investigator Oen explained that projects under $1,000.00 are subject to a “handyman exception,” but that this exemption does not apply to permitted work.

Respondent failed to appear at the time scheduled for hearing (July 11, 2017) and did not request to appear telephonically. After the expiration of a 20 minute grace period, the Administrative Law Judge conducted the hearing in Respondent’s absence.

CONCLUSIONS OF LAW

The Registrar bears the burden of proof to establish Mr. Yancovich’s violation of A.R.S. § 32-1151 by a preponderance of the evidence.

The Order Granting Continuance that the Administrative Law Judge mailed to Respondent at its addresses of record was reasonable and he is deemed to have received notice of the hearing.

Arizona contracting law prohibits a person from acting as a contractor without a license. The law allows an exemption from licensure, with certain limitations, for a “handyman.” An unlicensed handyman can perform construction work, with certain exclusions, such as that the work does not require a permit, as long as the aggregate price for the job, including labor and materials, does not exceed $1,000.00. 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. § 32-1121(A)(14) provides as follows:

Any person other than a licensed contractor engaging in any work or operation on one undertaking or project by one or more contracts, for which the aggregate contract price, including labor materials and all other items, but excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet utilizing a two pronged or three pronged electrical connector and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, is less than one thousand dollars. The work or operations that are exempt under this paragraph shall be of a casual or minor nature. This exemption does not apply:

(a) In any case in which the performance of the work requires a local building permit.

(b) In any case in which the work or construction is only a part of a larger or major operation, whether undertaken by the same or a different contractor, or in which a division of the operation is made in contracts of amounts less than one thousand dollars, excluding any electrical fixture or appliance that was designed by the manufacturer, that is unaltered, unchanged or unmodified by any person, that can be plugged into a common household electrical outlet utilizing a two pronged or three pronged electrical connector and that does not use any other form of energy, including natural gas, propane or other petroleum or gaseous fuel, to operate or is attached by a nail, screw or other fastening device to the frame or foundation of any residential structure, for the purpose of evasion of this chapter or otherwise.

(c) To a person who utilizes any form of advertising to the public in which the person's unlicensed status is not disclosed by including the words "not a licensed contractor" in the advertisement.

Emphasis added.

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.

After review of all the evidence, the Tribunal concludes that the Registrar has proven that Respondent engaged in contracting without a license when he submitted his verbal bid and received $600.00 for the Arkin project for which a permit was required and obtained.

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 the civil penalty for Respondent’s violation 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. Evidence received in this matter supports the imposition of a $1,500.00 penalty pursuant to A.A.C. R4-9-131(10).

RECOMMENDED ORDER

Based upon the foregoing, it is recommended that the Registrar affirm the finding that Mr. Yancovich violated A.R.S. § 32-1151 and affirm the decision to assess a civil penalty in the amount 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, July 17, 2017.

/s/ Suzanne Marwil

Administrative Law Judge

Transmitted electronically to:

Jeffrey Fleetham, Director

Registrar of Contractors