ALJDEC decisions subject to certification as final
2017A-454-CPA-ROC · Registrar of Contractors · 2017-05-15
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Registrar of Contractors,
IN THE MATTER OF THE
CIVIL PENALTY CITATION ISSUED TO:
Mark Allen Whittington,
No. 2017A-454-CPA-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: May 15, 2017
APPEARANCES: Respondent did not appear. The Arizona Registrar of Contractors was represented by Assistant Attorney General Thomas Raine
ADMINISTRATIVE LAW JUDGE: Roger A. Geddes
_____________________________________________________________________
Based on the evidence in this matter, the undersigned Administrative Law Judge hereby recommends that the Registrar of Contractors affirm the Cease and Desist Order and civil penalty issued to Respondent on January 26, 2017.
FINDINGS OF FACT
Respondent is not a licensed contractor in the State of Arizona.
2. On or about January 26, 2017, the Registrar of Contractors (“Registrar”) received a complaint against Respondent regarding alleged unlicensed contracting activities.
3. After investigating the complaint, the Registrar’s assigned investigator, Daniel Oen, issued Respondent a Cease and Desist Order and Civil Citation dated January 26, 2017, for failing to comply with A.R.S. § 32-1151, which pertains to contracting without a license. The proposed civil penalty was $2,500.00.
4. Respondent requested an administrative hearing and the Registrar forwarded the matter to the Office of Administrative Hearings, an independent agency, for an evidentiary hearing.
5. The Registrar issued a Notice of Hearing setting a hearing for May 15, 2017, at 8:00 A.M. The Registrar mailed a copy of the Notice of Hearing to Respondent on or about March 30, 2017, to 303 E. Gurley St., #465, Prescott, Arizona 86301, his address of record.
6. Although the commencement of the hearing was delayed approximately 30 minutes, Respondent did not appear at any time during the hearing, nor did he appear through an attorney or any other person. Consequently, Respondent did not present any evidence in his defense. Respondent further did not request to appear telephonically and did not request that the hearing be continued.
7. At the hearing, Investigator Oen testified that he investigated the matter on January 26, 2017, after the Registrar received an anonymous complaint that Respondent was doing construction work at a residence at 1630 Roadrunner South in Prescott, Arizona. Investigator Oen testified that he went to the residence and spoke with the property owner who advised him that “Mark Allen” came to his home handing out business cards and he entered into a contract with him to perform work in connection with a kitchen remodel. The property owner specified that Mark Allen was the designer and project supervisor and arranged for all the contractors for the project. Mark Allen was also making kitchen cabinets for the residence for which he was being paid. The property owner further disclosed that Mark Allen had secured the permit for the project and that the aggregate contract amount was for $30,000.00.
8. Investigator Oen testified that within 10 minutes after speaking with the owner at the residence, Mr. Oen observed Respondent leaving the residence. Investigator Oen testified that he recognized Respondent from previous interactions with him. Investigator Oen approached Respondent and indicated to him that Respondent’s work at the residence was unlawful. Respondent replied that he was not doing any work and then immediately left the property.
9. Investigator Oen also testified that he spoke with Mike Hawthorne, who the property owner represented was the “general contractor” on the project. According to Investigator Oen, Mr. Hawthorne stated that although he had a contract directly with the property owner, he was initially contacted by Respondent about the project and that Respondent was the “go to guy” on the project.
10. Investigator Oen also testified as to two other violations of Respondent in Arizona in 2016 for allegedly advertising without a contractor’s license and for acting in the capacity of a contractor without a license as well as additional violations in California of contracting without a license.
11. While Respondent did not attend the hearing or present evidence, in an earlier email from Respondent, he indicated that the property owner was the owner-builder and Respondent was merely assisting the owner-builder.
12. The Registrar argued that Respondent was acting as general contractor on the project.
CONCLUSIONS OF LAW
1. This matter lies within the Registrar’s jurisdiction.
2. The Registrar bears the burden of proof to establish Respondent’s statutory violation 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.”
3. A.R.S. § 32-1101(A)(3) defines “Contractor” in relevant part as follows:
"Contractor" is synonymous with the term "builder" and means any person, firm, partnership, corporation, association or other organization, or a combination of any of them, that, for compensation, undertakes to or offers to undertake to, purports to have the capacity to undertake to, submits a bid or responds to a request for qualification or a request for proposals for construction services to, does himself or by or through others, or directly or indirectly supervises others to:
(a) Construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building, highway, road, railroad, excavation or other structure, project, development or improvement, or to do any part thereof, including the erection of scaffolding or any other structure or work in connection with the construction.
...
4. A.R.S. § 32-1151 regarding engaging in contracting without a license 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.
5. A.R.S. § 32-1166 regarding the Registrar’s authority to impose civil penalties and to issue cease and desist orders provides in relevant part as follows:
A. In addition to all other remedies, when it appears to the registrar, either upon complaint or otherwise, that any person, firm, partnership, corporation, association or other organization, or a combination of any of them, has engaged in or is engaging in any act of contracting, practice or transaction which constitutes a violation of this chapter, or any rule or order of the registrar, the registrar may serve upon such person, firm, partnership, corporation, association or other organization not currently licensed under this chapter, by certified mail or by personal service, a cease and desist order requiring the person, firm, partnership, corporation, association or other organization to cease and desist immediately, upon receipt of the notice, from engaging in such act, practice or transaction. In conjunction with the cease and desist order, the registrar may issue a citation for a violation. Each citation shall be in writing and shall clearly describe the violation for which the citation was issued. Each citation shall contain an order to cease and desist and an assessment of 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. If after the issuance of a citation by the registrar, the person or organization receiving the citation fails to cease and desist in the violation or violations described in the citation, the registrar may assess an additional civil penalty of up to two thousand five hundred dollars for each day the violation or violations continue....
B. Each violation of this chapter or a rule or order of the registrar by a person who is required to be licensed by this chapter and who does not possess the required license shall constitute a separate offense, and the registrar may impose a civil penalty of not to exceed two thousand five hundred dollars for each violation except that for multiple violations committed on the same day the civil penalty shall not exceed two thousand five hundred dollars for all such violations. Monies collected from civil penalties shall be deposited in the state general fund.
C. The registrar of contractors may issue citations containing orders to cease and desist and of civil penalties against persons who have never been licensed under this chapter who are acting in the capacity of or engaging in the business of a contractor in this state.
6. Arizona Administrative Code Rule 4-9-131 regarding permissible aggravating and mitigating factors to be considered when assessing a civil penalty provides 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.
7. In this case, the Registrar has established that Respondent was contracting without a license. The evidence suggests that Respondent had initiated contact with the general contractor to perform work on the project and that Respondent had obtained all the other contractors for the project and had either directly or indirectly supervised them on the project. The evidence further suggests that Respondent obtained the building permit for the project. These activities support a finding that Respondent is a “contractor” as defined under A.R.S. § 32-1101(A)(3) and acting in the capacity of a contractor without a license in violation of A.R.S. § 32-1151.
8. A.R.S § 32-1121(A)(14) regarding persons not required to be licensed does not apply because the aggregate contract price exceeded $1,000 and due to the fact the performance of the work required a local building permit.
9. In accessing the civil penalty and the gravity of Respondent’s violation, aggravating factors that were present include previous violations committed by Respondent in 2016. While no other aggravating factors were identified, this past history of Respondent is sufficient to warrant a civil penalty of $2,500.00.
RECOMMENDED ORDER
Based on the foregoing, it is recommended that the Registrar affirm the finding that Respondent violated A.R.S. § 32-1151 and affirm the decision to assess a civil penalty under A.R.S. § 32-1166 for the unlicensed contracting violation in the amount 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 will be five days from the date of that certification.
Done this day, June 4, 2017.
/s/ Roger Geddes
Administrative Law Judge
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors