ALJDEC decisions subject to certification as final
2017A-5187-NPC-ROC · Registrar of Contractors · 2018-01-27
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Southwest Insealators LLC,
COMPLAINANT,
v.
Fleenor Construction LLC,
License No:
289501
RESPONDENT.
No. 2017A-5187-NPC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: January 23, 2018
APPEARANCES: Albert Huss, Complainant; Jenifer Hilsbos, Respondent; Roger Fleener, Respondent and Qualifying Party
ADMINISTRATIVE LAW JUDGE: Randy Wolfson
_____________________________________________________________________
Based on the entire record, the Administrative Law Judge makes the following Findings of Fact, Conclusions of Law, and Recommended Order to the Registrar of Contractors.
PROCEDURAL HISTORY
On October 13, 2017, the Registrar received a complaint against Respondent.
On November 17, 2017, the Registrar issued a citation to Respondent for violation of A.R.S. § 32-1154(A)(10).
The Registrar mailed the citation via certified mail to Respondent’s address of record.
The Registrar did not receive a timely Answer from Respondent. On November 28, 2017, the Registrar suspended Respondent’s license by Final Administrative Decision and Order.
On November 29, 2017, the Registrar received Respondent’s response to the Final Administrative Decision and Order.
On December, 2017, the Registrar determined that it’s November 28, 2017 Final Administrative Decision and Order should be set aside and that this matter proceed to a hearing before the Office of Administrative Hearings.
FINDINGS OF FACT
On 20th day of December 2017, Notice of Hearing was provided the parties setting hearing in this matter of January 23, 2018. On January 23, 2018, an evidentiary hearing in this case was conducted.
Respondent Fleenor Construction LLC (“Fleener”) holds license number 289501 issued by the Arizona Registrar of Contractors (ROC). Roger Fleener, is a member of or the qualifying party for Fleenor Construction LLC.
Albert Huss, Complainant, testified consistent with the complaint, of Southwest Insealators LLC (Southwest), that 7 separate invoices have been presented to Fleener for payment totaling $4,474.00 [exclusive of late payment penalties and interest], but that Fleener has failed and refused to make payment on the invoices.
Roger Fleener and Jenifer Hilsbos testifying for Fleener admitted that the Respondent owed the $4,474.00 alleged through the invoices attached to the complaint.
However, both Roger Fleener and Jenifer Hilsbos affirmatively defend that Fleener is entitled to an offset to the amounts charged by the Southwest invoices described in the complaint because Southwest either failed to post payments, credit overages on unrelated invoices or that Southwest failed to complete or perform jobs on unrelated invoices.
Fleener’s representative Jenifer Hilsbos testified that with the exception of the invoice described as the “Gara” project, Fleener is unable to provide any accounting or other evidence of the value Fleener alleges that Southwest either failed to post as payments, failed to credit for overages on unrelated invoices or where Southwest failed to complete or perform jobs on unrelated invoices.
With regard to the Gara project, Fleener Hilsbos testified that because of Southwest’s failure to complete the job to the customer’s satisfaction, Fleener finished the work using another contractor that cost Fleener a total of $415.00. Fleener is claiming an offset to the total owed Complainant for the same $415.00. No evidence, other than testimony of Ms. Hilsbos, was offered to substantiate Fleener’s claimed offset for $415.00.
No evidence was offered that Fleener did not or does not have the capacity to pay the invoices alleged in the complaint.
CONCLUSIONS OF LAW
This matter lies within the Registrar’s jurisdiction.
Complainant bears the burden of proof and must establish Respondent’s statutory violations by a preponderance of the evidence. Respondent bears the burden to establish affirmative defenses by the same evidentiary standard.
A party asserting a claim, right, or entitlement bears the burden of proof; a party asserting an affirmative defense has the burden of establishing the affirmative defense. The standard of proof on all issues in this matter is that of a preponderance of the evidence. Ariz. Admin. Code § R2-19-119.
A preponderance of the evidence is:
The 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.
Black’s Law Dictionary 1373 (10th ed. 2014).
Substantial evidence is evidence that a reasonable mind would use to reach a conclusion. See Mealey v. Arndt, 206 Ariz. 218, 76 P.3d 892 (App. 2003).
Statutes should be interpreted to provide a fair and sensible result. Gutierrez v. Industrial Commission of Arizona, 226 Ariz. 395, 249 P.3d 1095 (2011)(citation omitted); State v. McFall, 103 Ariz. 234, 238, 439 P.2d 805, 809 (1968) ("Courts will not place an absurd and unreasonable construction on statutes.")
“Statutes shall be liberally construed to effect their objects and to promote justice.” Ariz. Rev. Stat. § 1-211(B).
The purpose of the Registrar’s licensing statutes is to protect the public from unscrupulous, unqualified, and financially irresponsible contractors. See Aesthetic Property Maintenance v. Capital Indem. Corp., 183 Ariz. 74, 900 P. 2d 1210 (1995).
Ariz. Rev. Stat section 32-1154(A) provides that:
The holder of a license or any person listed on a license pursuant to this chapter shall not commit any of the following acts or omissions: .... 10. Failure by a licensee or agent or official of a licensee to pay monies in excess of seven hundred fifty dollars when due for materials or services rendered in connection with the licensee's operations as a contractor when the licensee has the capacity to pay or, if the licensee lacks the capacity to pay, when the licensee has received sufficient monies as payment for the particular construction work project or operation for which the services or materials were rendered or purchased.
That Fleener failed to pay Southwest $4,474.00 on the 7 invoices attached to the complaint is uncontroverted by the evidence.
Respondent Fleener claims that it should be relieved of obligation to pay Southwest certain sums, [the amount of which was not established by the evidence], because Southwest did not complete work on invoices unrelated to those presented in this case and, therefore, under industry practice, Fleener is entitled to offset the cost of completion.
A claim of set-off against monies that otherwise would be owed is an affirmative defense for which the party asserting the right to a set-off bears the burden to prove.
The legislature has not empowered the Registrar or the Office of Administrative Hearings to award attorneys’ fees or general consequential or equitable damages that would be awardable in a civil court action. To the extent that either party is entitled to attorneys’ fees, interest, additional consequential damages or additional damages under equitable theories of quantum meruit or unjust enrichment, they should be free to pursue these remedies in the pending arbitration or in court.
That Fleener may or may not be entitled to offset on these facts is an issue that need be determined in this proceeding inasmuch as Fleener provided no substantial evidence sufficient upon which to establish or corroborate the value or the basis of the claimed offsets.
The preponderance of evidence demonstrates to the fact-finder that Fleener violated Ariz. Rev. Stat §32-1154(A) as alleged in the complaint.
The record establishes by a preponderance that Complainant is due $4,474.00.
RECOMMENDED ORDER
IT IS RECOMMENDED that the Registrar suspend Respondent Fleenor Construction LLC (“Fleener”) license number 289501, for 7 days commencing on the effective date of this Order.
IT IS FURTHER RECOMMENDED that no suspension take place if, on or before the effective date of this Order, Respondent furnishes proof in writing to the Registrar that it has paid Complainant $4,474.00 in certified funds.
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 is forty days after the date of that certification.
Done this day, January 27, 2018.
/s/ Randy Wolfson
Administrative Law Judge
Copy mailed by USPS First Class mail
and by electronic mail this same date to:
Fleenor Construction LLC
530 E McDowell Rd Ste 107-489
Phoenix, AZ 85004-1549
Southwest Insealators LLC
5450 E Angela Dr
Scottsdale, AZ 85254-5803
Transmitted electronically to:
Jeffrey Fleetham, Director
Registrar of Contractors