ALJDEC decisions subject to certification as final
2017A-5367-NPC-ROC · Registrar of Contractors · 2018-01-27
IN THE OFFICE OF ADMINISTRATIVE HEARINGS
Top Onyx LLC,
COMPLAINANT,
v.
Hacienda Stone & Flooring Inc ,
License No: 268204
RESPONDENT.
[number redacted]
No. 2017A-5367-NPC-ROC
ADMINISTRATIVE LAW JUDGE DECISION
HEARING: January 23, 2018
APPEARANCES: DeWayne Lewis, Complainant; Rick Rascon, Respondent and
Qualifying Party, Wallid Awadalla, Respondent witness.
ADMINISTRATIVE LAW JUDGE: Randy Wolfson
_____________________________________________________________________
Evidence and testimony were presented and, based on the entire record in this matter, the following Findings of Fact, Conclusions of Law and Recommended Order are made:
FINDINGS OF FACT
On December 29, 2017, the Registrar of Contractors (“ROC”) issued a Notice of Hearing setting the above-captioned matter for hearing on January 23, 2018, at the Office of Administrative Hearings in Phoenix, Arizona.
Respondent Hacienda Stone & Flooring Inc., License No: 268204 (“HSF”) holds license number 268204 issued by ROC. Rick Rascon, the Qualifying Party and Wallid Awadalla, an employee of the Respondent, appeared and testified for HSF .
DeWayne Lewis appeared and testified for Complainant Top Onyx LLC. (“Top”).
HSF contracted to provide materials and installation for a kitchen cabinets and countertop project at the residence of ’s customer, Anthony Cerulo
HSF’s employee, Wallid Awadalla, a salesman and project supervisor for , initiated contact with the Complainant to undertake the countertop fabrication and installation for HSF and Mr. Awadalla testified that he was the site supervisor for the job.
On July 24, 2017, Top and HSF entered into an agreement under which Top was to fabricate and install selected granite material as a sub-contractor for a. [Exhibit C-6 Purchase Order].
The July 24, 2017 Purchase Order [Exhibit C-6] indicated that Top would provide fabrication services to HSF for $1,876.00, provide a miter cut for $84.00 and a sink cut out in the granite for $150.00 – all totaling $2,110.00.
Prior to the July 24, 2017 Purchase Order, Complainant texted Mr. Awadalla on July 19, 2017 [Exhibit C-1], to advise that fabrication costs would be $1,904.00 [$28.00 per square foot].
Mr. Awadalla responded that he did not understand and texted his understanding of the agreed upon charges for fabrication were at a $20.00 per square foot rate totaling $1,360.00 for the fabrication work. Mr. Lewis, the Complainant’s principal, replied in his text “I will call you...”
The text string continues next on the following day, July 20, 2017, from Mr. Awadalla stating: “I am waiting for your call.” Further texts occur in the chain, but nothing further is mentioned in the texts regarding the Top’s apparent increase in its per square foot charges for fabrication.
Mr. Rick Rascon testified that he did not become aware of the Top’s Invoice [Ibid] increasing the fabrication expense until after the Top job had been completed [in August 2017]. Mr. Rascon testified that his company’s profit, after expenses for material and labor, is calculated based upon purchase order figures obtained prior to hiring sub-contractors for work for HSF. It is upon these figures that the HSF also calculates its quote to the consumer for contracting services. All these charging and profit decisions are made prior to commitments being made to the consumer.
Mr. Rascon testified he relied upon the July 24, 2017 Purchase Order [Exhibit C-6] to provide his estimates for the job and that the Top’s $1,904.00 fabrication charges stated in Complainant’s July 19, 2017 text to Mr. Awadalla [C-1, supra] would have been too high to afford Top for this job.
The Top’s Invoices with increased fabrication charges was sent to HFS [Exhibits C-5, C-8] after completion of Top’s job in August of 2017,.
Mr. Lewis of Top testified that additional labor and expertise was required to fabricate, form and finish the countertop edges in the fashion that the customer wanted. The extra detail and shape of the countertop edges was not part of the original agreement, according to Mr. Lewis, but was a change order.
There is no evidence that any signed change order was presented, requested or obtained by HSF from Top.
By a preponderance of the evidence presented, it is determined that the terms set forth in the July 24, 2017 Purchase Order [Exhibit C-6] is the agreement of the parties hereto for this project: i.e., Top would provide fabrication and installation services to HSF for $1,876.00, provide a miter cut for $84.00 and a sink cut out in the granite for $150.00 – all totaling $2,110.00.
By a preponderance of the evidence it is shown that, because of a broken miter cut on a piece of the counter installed by Top, Mr. Anthony Cerulo agreed with Top and HSF that Mr. Cerulo it would accept a discount of $200.00 for the work performed by Top in lieu of repair.
Thus, by preponderance of the evidence, the contract price between the parties totals $2,110.00 per the July 24, 2017 Purchase Order less $200.00 discounted Anthony Cerulo, for a total due and owing Top by HSF of $1,910.00.
CONCLUSIONS OF LAW
This matter lies within the Registrar’s jurisdiction. See A.R.S. § 32-1101 et seq.
Unless otherwise provided by law, 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.
At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(2).
“At a hearing on an agency's imposition of fees or penalties or any agency compliance order, the agency has the burden of persuasion.” Ariz. Rev. Stat. § 41-1092.07(G)(3). 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).
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).
There is no evidence which supports a finding that the HSF is an “unscrupulous, unqualified, or a financially irresponsible contractor.”
With respect to the various additional work for which Top charged HSF that was not memorialized by a written or signed change order, once two contracting parties agree to a contract term, such as price “[o]ne party . . . cannot alter its terms without assent of the other party.” Therefore, “[o]rdinarily when a contractor makes a contract calling for performance of a job, in accordance with a certain plan, if nothing is said in regard to what shall be done in case he finds the work necessary to conform to the plan is for any reason more difficult or expensive than either party had anticipated, he must bear the cost of the excess of the contract price.”
Although Top may be able to show in some other venue that it is entitled to additional compensation under a theory of unjust enrichment, quantum meruit, or breach of an oral contract in a civil action, uncertainties in the evidence presented at the administrative hearing regarding the nature of the parties’ agreement, which apparently evolved over time, and the nature of the work Top performed, make it inappropriate to impose additional sanctions on HSF’s license for its failure to pay fabrication or installation amounts in addition to the original contract amount reflected by the July 24, 2017 Purchase Order [Exhibit C-6] indicating that Top would provide fabrication and installation services to HSF for $1,876.00, provide a miter cut for $84.00 and a sink cut out in the granite for $150.00 – all totaling $2,110.00.
Although HSF might be found in another forum to equitably owe the increased fabrication costs to Top as reflected by Top’s Invoices [Exhibits C-5, C-8] , the parties’ dispute primarily involves a contractual common-law question of quantum meruit.
Because the Arizona legislature has not empowered the Registrar of Contractors to resolve contractual disputes between contractors or to award contract damages, if the parties cannot agree to a mutually acceptable settlement, they must resolve their dispute in a judicial forum, not an administrative licensing proceeding.
RECOMMENDED ORDER
IT IS RECOMMENDED that on the effective date of the final Order in this matter Hacienda Stone & Flooring Inc., License No: 268204 is suspended until the Registrar of Contractors receives proof that Hacienda Stone & Flooring Inc., has paid Complainant Top Onyx LLC the sum of $1,910.00, in certified funds.
FURTHER IT IS RECOMMENDED that if Hacienda Stone & Flooring Inc does provide the Registrar with proof of payment as required by this Order, that the its license should not be suspended and that this matter be remanded to the Registrar to be dismissed.
Done this day, February 6, 2018.
/s/ Randy Wolfson
Administrative Law Judge
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.
Transmitted electronically to:
Respondent
Hacienda Stone & Flooring Inc.
1184 N Gilbert Rd
Gilbert, AZ 85234-2476
Complainant
Top Onyx LLC
Attn: DeWayne Lewis
1180 N Nantucket St
Chandler, AZ 85225-1540
Complainant’s Attorney
Ronald Roach
2375 E Camelback Rd
Phoenix, AZ 85016-3424
Jeffrey Fleetham, Director
Registrar of Contractors